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Neither is correct.
It should be either "two levels" or "two-level."
Numbers less than 10 should be written out, while those 10 and above should be written as numerals.
Each of these examples can be correct, under different conditions.¹
"Two levels" is a compound noun.
"Two-level" is a compound adjective.
Notice that a hyphen is required in the latter.
____________
¹ Examples:
It should be either "two levels" or "two-level."
Numbers less than 10 should be written out, while those 10 and above should be written as numerals.
Each of these examples can be correct, under different conditions.¹
"Two levels" is a compound noun.
"Two-level" is a compound adjective.
Notice that a hyphen is required in the latter.
____________
¹ Examples:
- "The test consisted of two levels."
- "It was a two-level test."