One of the dominant systematic effects that shift resonance lines in high-precision measurements of two-photon transitions is the dynamic (ac) Stark shift. For suitable laser frequencies, the ac Stark shift acquires an imaginary part which corresponds to the rate of resonant one-photon ionization of electrons into a continuum state. At the current level of spectroscopic accuracy, the underlying time-dependent quantum dynamics governing the atomic two-photon excitation process must be well understood, and related considerations are the subject of the present paper. In order to illustrate the basic mechanisms in the transient regime, we investigate an analytically solvable model scenario for the population dynamics in the density matrix formalism and describe in detail how to generalize the corresponding equations of motion for individual experimental use. We also calculate the dynamic Stark shift for two-photon S-S and S-D transitions in bound two-body Coulomb systems and the corresponding two-photon transition matrix elements. In particular, we investigate transitions for which the 1S ground state or alternatively the metastable 2S state acts as the lower-energy state, and for which states with n20 represent the upper states. Relativistic and radiative corrections to the excitation dynamics, and the corresponding limitations to the accuracy of the measurements, are briefly discussed. Our considerations suggest the general feasibility of a detection mechanism, offering high quantum efficiency, based on two-step three-photon resonant ionization spectroscopy, for large classes of experimentally relevant two-photon transitions in two-body Coulomb systems.