Just to reiterate what has been posted for other shells, in Bash the following works:
alias blah='function _blah(){ echo "First: $1"; echo "Second: $2"; };_blah'
Running the following:
blah one two
Gives the output below:
First: oneSecond: two
You found the way: create a function instead of an alias. The C shell has a mechanism for doing arguments to aliases, but bash and the Korn shell don't, because the function mechanism is more flexible and offers the same capability.
You cannot in ksh, but you can in csh.
alias mkcd 'mkdir \!^; cd \!^1'
In ksh, function is the way to go. But if you really really wanted to use alias:
alias mkcd='_(){ mkdir $1; cd $1; }; _'