The cycloid planetary gear reducers are widely applied in automation machinery. Even having the advantages of high gear ratio, multiple contact tooth pairs and shock absorbing ability, how to enlarge the power density of the drives is still the essential development work today. To this end, the concept of tooth number difference of two is proposed. The aim of the paper is to analyze systematically the loaded contact characteristic of such the cycloid planetary gear drives so as to evaluate the feasibility. A set of essential equations for the cycloid profile, the tooth contact and the specific sliding of the cycloid stage are at first derived in the paper. A loaded tooth contact analysis approach is extended from a developed model based on the influence coefficient method. The influences of the design parameters on the contact characteristics are systematically analyzed with an example. These results are also compared with the conventional drive having tooth number difference of one. The analysis results show that the proposed concept with a larger eccentricity and a smaller pin radius can not only effectively enlarge the contact ratio, but also reduce the specific sliding, the shared loads and the contact stress. Although the radial portion of the bearing load can be also reduced accordingly, the total periodical time-variant bearing load can not be reduced effectively by using the concept of tooth number difference of two.