Attributes are compile-time things, mostly, so you can't easily do this.
Also, I can't think of an example of a component or control which hides one
property based on the value of another property.

You can throw an exception in the property setter for property2 based on the
value of property1.

Also, if you create a designer for your component, you can override the
PostFilterProperties method to replace the normal "property2" property
setter and replace it either with one that has Browsable(false), or, for
instance, with one which is read-only.

John Saunders