The two party system in the U.S. began in the 1790’s. The two parties were the Democratic-Republicans led by Thomas Jefferson and the Federalists led by Alexander Hamilton. This first party system began to end after the War of 1812. Most Americans perceived the end of this war as an American victory, and thus began the Era of Good Feelings, which was a time of very little partisanship in the government. The Federalist Party began its decline when James Monroe defeated the Federalist candidate in 1816. The following election in 1820 spelled the end of the Federalist Party when Monroe faced no real opposition in his reelection.
The bitter election of 1824 meant the end of the Era of Good Feelings. Four Democratic-Republicans ran for president, Andrew Jackson, John Quincy Adams, Henry Clay, and William H. Crawford. No one received a majority of electoral votes so the election was decided by the House of Representatives. The House chose John Quincy Adams as president even though Andrew Jackson received more popular votes and electoral votes than any other candidate. Jackson and his supporters claimed that there was a “corrupt bargain” with the election of Adams by the House of Representatives. With growing sectional differences within the U.S. and with the bitterness experienced in the election of 1824, new political parties were established.
THe end of the first party system occurred after the war of 1812 and strangely left the country with only one party, the "Democratic Republican" party.
The rise of the second party system coincided with the rise to power and influence of Andrew Jackson and his supporters who became the Jacksonian democrats. They supported the power of the president being superior to that of the congress and were in opposition to the Bank of the United States.
Henry Clay and the Whig party grew in power and influence in opposition to the Democrats.