Duplicate the circle halfway over the first circle. Select both circles.
Use the Pathfinder Intersect mode to leave the overlapping section.
Choose Object > Path > Add Anchor Points. This will add points to the shape halfway between the existing points.
Choose Effect > Transform > Pucker & Bloat. Set the slider toward Pucker.
This will get the lines to pull in from each point. Choose Object > Expand Appearance.
Fill the shape with a color, remove the stroke.
Choose Object > Path > Offset Path and set the offset smaller than the original.
Fill the new shape with a lighter color.
Add a line to the center, hot dog the line ends and make it a lighter color.
Use the Direct Selection Tool to select the shape and pull in the corner widgets slightly to round the ends.
This is the results. Select the shapes and group them together.
Duplicate and rotate the leaves into a set.
Duplicate the first set so they fit together.
Draw a rectangle over the shapes so the rectangle creates a section that will repeat. Make sure the rectangle create a perfect "snap shot" of the section, starting and stopping in the same location so the final brush fit together seamlessly. Set the rectangle to no fill and stroke, send it to the back.
Open the Brushes panel from the Window Menu. Drag the leaves and the rectangle into the Brushes panel. It will ask for the type of Brush to create. Choose Pattern Brush.
Name the brush and click OK.
Create a circle. Apply the Holly to the stroke of the shape. The leaves may be larger than you want.
Double click on the Holly Brush in the Brushes panel, set the Scale to be a smaller value. Or choose Options of Selected Object… from the Brush dropdown menu and set the brush smaller.
This is the result of the smaller applied brush.
Copy the wreath and choose Edit > Paste in Place. Or choose Options of Selected Object… from the Brush dropdown menu and set the brush smaller. Rotate the pasted circle a it to make the wreath look more full.
Create 3 circles for the berries. Add a fill and a stroke. Select the berries and drag them into the Brushes Panel.
Choose Scatter brush from the New Brush dialog box that pops up.
Use the Brush Tool, select the berries from the brush panel and click on the wreath to add them.