The siblings kicked off their New Year festivities early at the celebration at a friend's place in Bucklebury.
"Kate looked incredible," a fellow reveler told PEOPLE. "She was very jolly and very happy."
The eyewitness says the new mom, 31, who gave birth to son George in July, "has really got her figure back. If anything she actually looks better now than before she had Prince George."
While George and his dad, Prince William, weren't spotted at the party, Kate clearly enjoyed herself.
"The thing that really strikes you is that she is just so normal and smiley," the partygoer said. "There are no lights on Kate here, so she can be totally relaxed and herself."
"I came away from the party thinking, 'She looks really happy.' Kate really is glowing and full of life."
The relaxed celebration was a contrast to the new family's recent Christmas festivities with the Queen and Prince Charles at Sandringham, where they were expected to dress formally for dinner and follow other royal traditions.
Last year the entire Middleton family – minus a pregnant Kate – toured the local pubs on their pushbikes before cycling across Berkshire's rolling hills for a festive tipple at home.
Let's hope George got a tricycle for Christmas!