updated 01/19/2014 AT 6:00 PM ET
•originally published 01/19/2014 AT 3:00 PM ET
Sasha and Malia Obama watched in awe as Beyoncé sang, while elsewhere, Paul McCartney danced and Hillary Clinton schmoozed. “It was just an incredible party,” the guest told PEOPLE, “chock-full of celebrities.”
And, just as she wished for, the birthday girl danced. And danced. Wearing a long red jumpsuit reminiscent of her 2012 Inaugural gown, Mrs. Obama arrived laughing and never stopped beaming. “She was enthralled. You could tell she had a lot of fun,” says the guest.
Smokey Robinson greeted Hillary Clinton with a bear hug at the North Portico door where she’d been talking with Democratic Party donors, while Bill Clinton chatted with Jennifer Hudson. Top White House adviser Valerie Jarrett was on the arm of NFL veteran and sportscaster Ahmad Rashad. James Taylor held court with House Minority Leader Nancy Pelosi, who later tried to get a dance with McCartney, who only had eyes for his wife of two years, Nancy Shevell.
“Sir Paul didn’t allow many people to come between him and his bride. He came to party!” says the source. “He pulled his jacket off, put it at Valerie’s table and then danced away with his wife.”
To fuel all that partying, there were mini crab cakes, fried oysters on toast rounds, roast beef sliders and champagne. When the birthday cake was brought out, John Legend sang two different renditions of “Happy Birthday” – the standard-issue version, then a jazzier take.