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In the past, etiquette demanded that only non-relatives of the parents-to-be host a baby shower. Fortunately this has changed and mothers or sisters often host the showers now.
Keep in mind that more than one person can host the shower, too. If staying within the family, the mom-to-be's mother and sisters may want to share in the planning (and thus, the costs) of hosting the baby shower.
When it comes to a guest list, if it is not a surprise party, by all means show the guest of honor your proposed list. She may want to add (or subtract!) someone. A baby shower is generally attended by the relatives of the mom (and dad), mom's friends and close co-workers, and so on.
It is accepted to do invitations by email or by calling the guests, but many people still prefer the traditional paper and mail invitations. If the parents are registered somewhere, be sure to let your guests know.