CSS - Syntax to select a class within an id

#navigation .navigationLevel2 li
{
    color: #f00;
}

This will also work and you don't need the extra class:

#navigation li li {}

If you have a third level of LI's you may have to reset/override some of the styles they will inherit from the above selector. You can target the third level like so:

#navigation li li li {}

Here's two options. I prefer the navigationAlt option since it involves less work in the end:

<html>

<head>
  <style type="text/css">
    #navigation li {
      color: green;
    }
    #navigation li .navigationLevel2 {
      color: red;
    }
    #navigationAlt {
      color: green;
    }
    #navigationAlt ul {
      color: red;
    }
  </style>
</head>

<body>
  <ul id="navigation">
    <li>Level 1 item
      <ul>
        <li class="navigationLevel2">Level 2 item</li>
      </ul>
    </li>
  </ul>
  <ul id="navigationAlt">
    <li>Level 1 item
      <ul>
        <li>Level 2 item</li>
      </ul>
    </li>
  </ul>
</body>

</html>