Introduction. In Canada, bacille Calmette-Guerin (BCG) vaccine is now primarily given to First Nations and Inuit (FNI) neonates living in tuberculosis (TB) endemic areas. With declining TB rates, attention has shifted from the protective effects of BCG to reports of serious vaccine-associated adverse events (VAAE). Methods. Surveillance data were reviewed to assess TB burden and trends, BCG coverage, and VAAE among FNI people in the 1990s. Results. TB among FNI people living on reserve was 25 times higher than the Canadian-born, non-Aboriginal rate between 1997 and 2000. Paediatric TB rates declined from 149 per 100,000 in 1990 to 23 per 100,000 in 2000, with one case of TB meningitis and one TB fatality (due to congenital TB) reported in the 0–4 age group. Nine cases of disseminated BCG infection occurred in a 21-year period among children with congenital or acquired immunodeficiencies. The estimated rate of disseminated BCG infection was 205 per 1,000,000 (95% CI 62 - 678). Discussion. BCG provides protection against severe forms of childhood TB. However, in a country with publicly funded health care and declining TB rates, it is important to consider VAAE. Disseminated BCG infection increases mortality among children with immunodeficiency disorders, which now have successful therapies. Although TB remains a threat in FNI communities, early detection and treatment of TB infection may be a more appropriate intervention.