The Canadians won 25-23, 25-17, 25-23 against one of the nations expected to be in the hunt for the gold medal. The Americans were hardly in the contest as Canada ran out impressive winners.
This is Canada's first volleyball Olympic tournament for 24 years and the team, which plays in world volleyball's second division, was considered an outsider.
“It's the first time we've been in the Olympics, all of us, this is our first shot, it's big for Canada to be here," setter Tyler Sanders said after the match. We're going into the rest of the tournament with maybe a different perspective. We're going to try and be as aggressive as we can.”
The US coach John Speraw was visibly frustrated by his side’s defeat, admitting they didn’t play as well as he expected.
"We knew we were in for a real fight but I didn't think we'd have as many issues as we had on our side of the net," he said.
“I didn’t think we would go through this tournament unscathed. If we are to achieve the goals we have set, maybe this is our path.”
Canada will now play gold medal hopefuls Brazil on Tuesday, while the US go up against Italy.
Brazil recovered from a set down and beat Mexico in the first Olympic match for one of the host nation's best gold medal hopes.
Mexico, rank outsiders who have not qualified for Olympic volleyball since hosting the Games in 1968, capitalised on numerous errors from Brazil to win the first set 25-23.
But a raucous home crowd, who jumped to their feet for every winning point, and an improved serve, allowed Brazil to fight their way back to win 23-25, 25-19, 25-14, 25-18.
After launching a signed ball into the cheering crowd, captain Sergio Santos admitted nerves might have got to the team.
“Those who have never competed in an Olympics before felt a difference playing with those rings on the floor,” said Santos, who is playing his fourth Olympics.
"We have it in our heads that we always need to win, that's the pressure that surrounds the Brazilian team. But we know we'll only win this title by playing well," he said.