The game was originally intended to be the fifth installment of the Super Mario Bros. series, with two leaked prototypes from December 1994 featuring a title screen with the logo Super Mario Bros. 5: Yoshi's Island. Come the final release, and the prefix would be shortened to Super Mario. This explains why the international release was titled Super Mario World 2: Yoshi's Island, as the original Super Mario World was subtitled Super Mario Bros. 4 in Japan.

Additionally, the later of the two prototypes features a radically different design for the logo, using a much sleeker and blockier font. The final release would revert to the earlier logo, barring the aforementioned truncated prefix.

In a 1995 developer interview, Shigeru Miyamoto stated that the Super Star was originally going to briefly transform Baby Mario into his adult self. However, the idea was discarded after one of the developers pointed out that it would clash with the game's premise of being an origin story for the Mario brothers. Instead, Super Star Mario was redesigned to simply be Baby Mario in a yellow cape.

In 2020, sprites for Mario's adult form were uncovered as part of a massive leak of data from Nintendo's internal servers. These sprites indicate that Super Star Mario was not originally able to float in the air and that he was able to ride Yoshi to some extent (in the final game, Yoshi reverts to an egg until the Super Star wears off).

Among files uncovered in the Gigaleak, a large-scale leak of assets from Nintendo's internal servers in 2020, are various assets from Super Mario World 2: Yoshi's Island depicting alternate ideas for Baby Mario. The earliest of these assets are a series of sprites from October 1993 depicting him in a bonnet and with a mustache similar to his adult counterpart; by comparison, the earliest sprites depicting his final design are dated to August 1994.

In the interim, however, Nintendo apparently considered omitting Baby Mario entirely; sprites dating to the spring of 1994 show that the developers considered having the Yoshi Clan ferry an infant wizard around instead. These sprites depict the wizard both in normal gameplay and in the pre-rendered CGI graphics used in the opening cutscene. Other sprites of the wizard show that they would've provided an in-universe reason for Yoshi's ability to transform into various vehicles: the wizard would cast a spell on a Yoshi egg while encasing themself and the real Yoshi in a bubble.

While the developers ultimately went back to using Baby Mario, the wizard still appears in a prototype build from December 6, 1994. In this iteration, the wizard is a form that Baby Mario can turn into through the use of an item depicting the projectiles fired by Kamek in the penultimate area of "6-8: King Bowser's Castle". This "Wizard Mario" form could similarly cast spells that transform certain enemies into objects such as eggs, watermelons, and Winged Clouds.

While Bumpties can only bump into Yoshi and not hurt him, if Yoshi is hurt by a different enemy or obstacle and a Bumpty is on-screen, it will run to and steal Baby Mario similarly to a Bandit. This is the only game in the Yoshi series where Bumpties are known to behave like this, and is a rare interaction since there are few instances in the game where Bumpties and obstacles are close enough to trigger it.

Leaked development files for Yoshi's Island show graphics of a razor blade hazard or weapon, possibly intended to be thrown by an enemy. This was likely removed from the game over concerns of violence and/or imitability.

Early designs of the Toadies in the ys_romX_0 prototype of the game show that they originally resembled Snifits.

During the second phase of the final boss fight in the SNES release, Baby Bowser has three fingers on each hand, contrasting with most official portrayals of Bowser, which show him with four. This error is fixed in the Game Boy Advance version, which redraws his sprites to give him the proper number of fingers.