We had a fun Christmas party for my 7 year old son last year.  It was such a big hit that we're doing it again this year. This time we're also including our 3 year old son and some of his friends. The invitations were Christmas trees made out of green stock paper. We added a face to the tree and included "Please, bring a bag of your favorite candy." We put together and decorated a gingerbread house. They loved it! We also made rice crispy squares, cookies and Christmas candy.  We had Christmas music playing, so they sang and danced a bit while we prepared  some snacks. It was just chips, cheese dip and pigs in blankets.  The table was an eye catcher. We used a simple green paper tablecloth.  There were napkin holders(small rings cut from toilet paper rolls, then painted and decorated), snowmen(3 cottonballs glued on a painted toilet paper roll, things for the face and a felt hat), felt mice with candy cane tails, and big Styrofoam cups with chocolate snowballs hanging out of them. They're big marshmallows dipped in melted chocolate with Christmas colored sprinkles. We pushed a green or red flexible straw on the bottom of each one and placed them in cups till the excess dripped off then, stood them up in the Styrofoam cups. The placecards were gumdrop trees made by putting gumdrops into styrafoam balls with toothpicks then, placing it into a painted Styrofoam cup. I put their names, in glitter, on colored stockcard paper, cut out into stars and angels, and glued them onto the base or trunk of the tree.  For goodie bags we had little decorated bags from the dollar store filled with homemade chocolate almonds and pecans, small stockings with toys, and candy and prizes stuffed into a toilet paper roll, wrapped in green or red tissue paper, tied at both ends with different colored ribbon and decorated with stickers(this last one was also setting on the table when they arrived.) We put all 3 of these, the ornaments they made out of sugar cookies, lots of candy and everything they made.  They really enjoyed getting their hands into everything.  We took a picture of each person beside the gingerbread house and sent it home, too. We have already had children ask us if we're having another one. I hope this gives you some good ideas for a great Christmas party.