Is this correct? It looks like double negation.
I think that “little party killed nobody” or “little party never killed anybody” might be just a little bit better.
This is a line from a song.
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It is not a correct sentence, but is commonly used as slang. It unambiguously means "... never killed anybody."
Also note, some AmE native speakers won't have a clue that it is wrong and may be offended if you suggest it is.
I would never use double negatives myself except in rare cases where it is a specific stylistic choice. I suggest using the same caution. Those who know better may either think less of you (if they think you are native) or, at the least, think you don't know English as well as you do.