In 2009, a novel poxvirus was identified in a North American red squirrel (Tamiasciurus hudsonicus) from Yukon, Canada. Initial molecular analyses indicated that this virus was likely to be distinct from all other known mammalian poxviruses, including those previously associated with disease in tree squirrels—squirrel fibroma virus in North America and squirrelpox virus in the UK (UK SQPV). We characterize the Canadian squirrelpox virus (Canadian SQPV) using DNA sequence analysis and negative-contrast transmission electron microscopy (TEM). Sequence analysis revealed that the Canadian SQPV is distinct from all known mammalian poxviruses but most closely related to the parapoxviruses, followed by UK SQPV. In contrast, TEM showed that the ultrastructure of Canadian SQPV is distinct from that of the parapoxviruses and UK SQPV but indistinguishable from that of other chordopoxviruses (a morphological group that includes the orthopoxviruses and leporipoxviruses). Overall, our analyses suggest a potential evolutionary relationship between UK SQPV and Canadian SQPV and supports our assertion that the Canadian virus represents a newly identified poxvirus in North American tree squirrels.