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Most of the game's setting and objects are made out of LEGO bricks. Like its predecessor, this game presents a very humorous view of the Star Wars universe, and re-tells some of the original trilogy's most famous moments through cut-scenes that feature no dialogue.
The ability to "create" new LEGO Star Wars characters is a new feature in the game, allowing the player to mix multiple character parts, which also automatically creates a name for the new character (such as a Master Leia, C, Boba Skywalker or Darth 3PO). Using a saved game from the previous Lego Star Wars games allows the player to transfer the prequel characters into the Original Trilogy, although prequel characters cannot be customized, save for a few select pieces.
Blaster-wielding characters now have a number of new techniques, as because of a reduction in the number of Jedi and Sith characters, more emphasis was placed on them. They can now dodge incoming blaster fire, use melee attacks, automatically aim and fire on the nearest enemy and can use a diving technique. This is performed by jumping, and pressing the jump button in mid air. If the player presses the attack button during the dive, when the character lands, they will fire off a volley of blasts.
The difficulty adjusts to suit the player. The "adaptive difficulty" function is a feature that has been implemented by Traveller's Tales as a response to the relative ease in which gamers completed the first game. This feature can be manually turned on or off in the Extras menu.