Thunderstorm winds are the costliest wind hazard in Canada, but they have not been well studied. This paper investigates atmospheric conditions prone to downbursts in Canada using a combination of reported downbursts from damage survey reports, ERA5 reanalysis data, lightning flash observations, radar imagery, and upper air measurements for the period of 2019–2023. We propose a novel Downburst Precursor Parameter (DPP) by integrating two low-correlated thermodynamic and kinematic parameters. DPP outperforms other existing instability indices in downburst diagnosis in Canada. Our spatial analysis reveals the absence of damaging downbursts west of the Rockies, while approximately half of all recorded damaging downbursts occurred in southeastern Canada. Squall lines and supercells are the most common types of downburst-generating storms in Canada. Furthermore, nearly two-thirds of storms are squall lines when a downburst is accompanied by lightning flashes, which occurred in ∼71% of all cases. The remaining ∼29% of downbursts without lightning are mostly dry downbursts, typically displaying a disorganized pattern of convective storms on a radar screen. The equivalent potential temperature difference between the surface and mid-level in the troposphere (∆θe) exceeds 13 K prior to 61% of damaging downbursts. This result indicates that ∆θe might be a useful downburst indicator in Canada despite lower values compared to many regions in the United States.