The Caledonian and Ellesmerian orogenies were followed by extension and development of intracontinental rift basins since the late Paleozoic, as represented by the Sverdrup Basin along the Canadian Arctic Islands. The initial rifting was accompanied by pulses of volcanic activity during the Carboniferous and Permian. A new occurrence of mafic volcanic rocks, the “Taconite volcanics” (informal name), was discovered on northern Ellesmere Island between the head of Ayles Fiord and M’Clintock Inlet. The mainly alkali-picritic lavas are exposed within the central part of the Pearya Terrane as an outcrop in faulted contact with upper Carboniferous red beds of the Canyon Fiord Formation. The contact to the Ordovician island-arc volcanic rocks of the Pearya Terrane is unclear. The outcrop is characterized by a small circular magnetic anomaly. Ar–Ar whole-rock geochronology on the volcanic rocks yielded an age of 290 ± 19 Ma suggesting emplacement of the lavas during the early Permian. Whole rock geochemical analyses for eight samples revealed a geochemical affinity to ocean island basalt (OIB) and indicate variable mixing of low-degree melts in the fields of garnet and spinel peridotite (∼80–90 km depth). The involvement of a metasomatized subcontinental lithospheric mantle is indicated by high Pb, Nb, and Ta concentrations. Geochemical differences (as enrichments in Ti, Nb, Zr, and the light rare earth elements (REE)) to the known Carboniferous and Permian spilitic altered basalt occurrences of northwestern Ellesmere and northern Axel Heiberg islands are probably based on differences in the mantle source. The Sr isotope ratios of the Taconite volcanics are primitive ((87Sr/86Sr)t: 0.7037–0.7042) and its Nd isotope ratios are moderately depleted (εNd(t): +2.20 to +2.85) in contrast to the enriched εNd(t) values of the Permian Esayoo formation.