Who is invited: First and foremost, much like bridal showers or bachelor parties, don’t invite anyone you don’t intend on inviting to the wedding (the exception being if you are having a small destination wedding, with a reception at home, later). Engagement parties are usually more intimate affairs, but there is reason to limit the guest list, provided your host approves of and can accommodate the size.
Who can host: Anyone other than the couple. Unlike bridal showers, either of the couple’s families can host this party. The reason for this is that showers are gift-giving occasions and it is in poor taste for a family member to solicit gifts. Engagement parties require no presents, and therefore anyone can host. Sometimes members of the wedding party throw the engagement party, and that is perfectly acceptable if they offer to do so.