。
She danced for joy.
Literal
She [topic-は] gladly little-dance [object-を] did.
小躍り is a vivid little compound: 小 ('small') + 躍り ('leaping, dancing,' the masu-stem of 躍る). It paints a small jumping or skipping movement — the kind one does involuntarily when delighted, sometimes literally a little hop, sometimes more figurative for inner exuberance. The phrasing 喜んで小躍りをした layers two joy-words: 'gladly' modifying the manner, then 'did a little dance' as the action — a slightly bookish, almost picture-book register.