Unfortunately, leveling up only upgrades that one stat, so you'll have to choose carefully. Also, once you beat the boss of any one area, the enemies in that area will no longer give you star points when you defeat them. This, combined with the slow process of upgrading all your stats, keeps the leveling up in Paper Mario a fairly controlled process, as you cannot become more powerful than you're supposed to be. Actually participating in combat is also extremely simple. Mario and his companion stay on the left side of the screen, and enemies line up to on the right side of the screen.
Enemies are either on the ground, in the air, or on the ceiling of indoor areas.
Mario can hammer the first enemy in line on the ground, or he can jump on any enemy on the ground or in the air. Mario's sidekick has a basic attack that usually specializes in air enemies or ground enemies and an additional special attack. Mario can find special blocks that let him upgrade his sidekicks, which will not only boost that sidekick's attack power but will allow that sidekick to learn brand-new special attacks. Landing attacks has an appropriate effect on enemies. Jumping on flying goombas will remove their wings and make them ground-based, and jumping on koopas will flip them.