At the party, they playfully butt-squatted on each other's laps as a joke.

butt-squatted 是由 butt（臀部）和 squat（蹲）组成的复合动词，squat 加上 -ed 变为过去式。butt-squat 字面意思是"用臀部蹲坐"，指一种开玩笑的坐姿，即坐在别人腿上但不用力压下去。