The Liberal government will no longer refer to the Islamic State of Iraq and the Levant and will instead call the group by a different, potentially insulting name: Daesh.
Public Safety Minister Ralph Goodale revealed the change in a report on terrorism released last month, saying ISIL is neither Islamic nor a state and that the report would instead use the group's Arabic acronym.
Global Affairs Canada and the Department of National Defence also say they are both adopting Daesh to refer to the group.
The decision continues a trend that has been sweeping through western governments.
France and the United Kingdom are among those that have adopted the term in recent years.
But while the term has long been used by Arabic speakers and comes from the group's Arabic acronym, it can also be considered an insult, with some translations meaning to tread underfoot or crush.
The group has forbidden use of the term Daesh within its territory.
There has long been a great deal of confusion and debate over what to call the militant group.
Canada and many other countries used its original name, the Islamic State of Iraq and the Levant, or ISIL, for years. Others referred to it as the Islamic State of Iraq and Syria or the Islamic State of Iraq and al-Sham, or ISIS.