An Oscar party involves everybody dressing up in their best facsimile of red carpet-wear, copious amounts of movie-themed drinks and snacks, and compulsory gambling on the winners of the categories. Whoever has the greatest number correct by the time Best Picture is announced gets the money, a plastic statuette that looks just different enough from an Oscar that the manufacturer won't get sued, and the opportunity to make an acceptance speech.
Side-betting is actively encouraged in order to ramp up the drama and emotional investment in the spectacle.