The Arctic Ocean bounds Nunavut to the north, Greenland (separated from it by a series of narrow straits, Baffin Bay, and Davis Strait) lies to the east, and Quebec adjoins it to the southeast across Hudson Strait and the northeastern arm of Hudson Bay. Its only land boundaries are with Manitoba to the south and the Northwest Territories to the southwest and west. Nunavut constitutes the greater part of the Canadian Arctic Archipelago, including its largest island, Baffin Island. In addition, several islands are divided between Nunavut and the Northwest Territories (notably Victoria (Victoria Island) and Melville (Melville Island) islands), and Nunavut's territory extends to numerous islands in Hudson Bay, such as the Belcher Islands. Area 808,185 square miles (2,093,190 square km). Pop. (2001) 26,745; (2006) 29,474.

The territory lies entirely within the Arctic climatic zone, with bitterly cold winters and cool to cold summers. Average daily January temperatures rise above −22 °F (−30 °C) only in the eastern coastal areas, and in the far north and northwest of Hudson Bay they reach only −31 °F (−35 °C). Average temperatures in July above 50 °F (10 °C) are limited to the area west of Hudson Bay, while in the far north and along the northeastern coast of Baffin Island they do not exceed 41 °F (5 °C). Precipitation is scant throughout most of the territory and falls almost entirely as snow. Annual precipitation levels of less than 8 inches (200 mm) gradually increase toward the east; the greatest amounts—more than 24 inches (600 mm)—occur on Bylot Island, just north of Baffin Island. Continuous permafrost underlies virtually the entire territory.

The Inuit (Eskimo) constitute more than four-fifths of Nunavut's population; nearly all of the rest are of European descent. The language of the Inuit, Inuktitut (Inuit language), consisting of several dialect groups, is spoken widely. It has two writing systems: roman letters and a syllabic system developed in the 19th century by European missionaries. The territorial government recognizes Inuinnaqtun, an Inuktitut dialect spoken in western Nunavut and written in roman letters, as one of the territory's four main languages (Inuktitut, English, and French are the other three).

Early contacts with explorers and whaling crews introduced new diseases and reduced the population during the 19th century. The fur trade was not well established in the Arctic until early in the 20th century, but the Inuit adapted quickly to it, and they, like the Dene, came to depend on outside sources for most of the necessities of life. Construction activity during World War II and in the postwar years further affected their way of life. The Inuit adapted readily to the opportunities for casual employment, and many were quick to abandon their seminomadic trapping and hunting existence for life in the settlements. Canadian government policy in the 1950s and '60s promoted that trend.

Nunavut is among the most sparsely populated habitable regions on Earth. Settlements are very small and are clustered largely in the coastal areas. Iqaluit, the administrative, commercial, and cultural centre of the territory, is the largest town. Among the other towns are Rankin Inlet (Kangiqting) on the northwest coast of Hudson Bay, Pangnirtung (Panniqtuuq) on the Cumberland Peninsula of Baffin Island, and Cambridge Bay (Ikaluktutiak) on the southeast coast of Victoria Island. Alert, a weather station and military outpost on the north coast of Ellesmere Island, is the northernmost community in North America.

Because of the high rate of natural increase among the Inuit, their proportion of the territorial population is growing. The age structure of the territory is considerably younger than it is for the rest of Canada, and more than one-third of the population is younger than age 15.

Aside from its people, Nunavut's greatest economic asset is its mineral wealth, which includes reserves of iron and nonferrous ores, precious metals and diamonds, and petroleum and natural gas. Exploitation of those resources is hampered, however, by high production costs and transportation difficulties. The federal government has participated in resource development mainly by providing infrastructure and assisting in the search for minerals. In addition, government agencies produce and distribute electric power throughout the territory. The government and its agencies are a major source of employment and income for the territory.

The largest source of jobs is the service sector, particularly such government services as administration, health care, education, and welfare. Many construction jobs have been available in both the public and private sectors, although substantial numbers of those employed are migrant workers attracted by high wages. Tourism, centred around the territory's natural attractions and unique culture, constitutes a small but significant service industry. Overall, however, the unemployment rate in Nunavut is higher than that in Canada as a whole. The territory derives the bulk of its revenue from the federal government, though it does collect income, consumption, and property taxes.

The federal government in Ottawa retains the ultimate responsibility for government in the territory. However, a territorial administration sitting at Iqaluit exercises effective government power. This administration consists of a commissioner, who is appointed by the Canadian government and whose powers are largely ceremonial, and the Legislative Assembly, which is elected by the people of the territory. All members of the assembly are elected as independents, as there is no system of political parties. The assembly chooses a speaker, a premier, and a cabinet from among its members to form a government. The working language of the administration is Inuktitut, although English and French also are used.

The justice system is headed by a single-level trial court. Law enforcement is carried out by community-based policing services supported by the Royal Canadian Mounted Police.

Nunavut elects one representative to the Canadian Parliament. The federal government controls natural resources on federally owned lands and administers them through its Department of Indian and Northern Affairs Canada.

Most of the region's education and health care services were provided by missionaries until the 1950s, when the Canadian government largely took over those responsibilities. Today Nunavut's Department of Education oversees elementary and secondary schooling, and Nunavut Arctic College in Iqaluit offers postsecondary programs and courses. The use of Inuktitut is promoted in the schools, and the federal Department of Indian and Northern Affairs Canada gives financial support for aboriginal education. Community health nurses, regional health-care centres, and a hospital in Iqaluit provide health care. The territory offers comprehensive medical insurance plans to residents.

Despite the impact of North American media and other modern influences, many traditional elements of the Inuit culture have been preserved. In the years following World War II, Canadian artist and author James Archibald Houston, with the assistance of the Hudson's Bay Company, was instrumental in the promotion and sale of Inuit art. Public policy has continued to encourage the development of Inuit traditions in arts and crafts—including stone carvings, weavings, and prints—providing an important supplementary source of income in some Inuit communities and making Inuit culture familiar to collectors worldwide. In the late 20th and early 21st centuries, the musical career of Inuit singer and lyricist Susan Aglukark also promoted greater understanding and appreciation of Inuit cultural life in a modern context.

Winter sports, such as hockey and curling, are popular in Nunavut, as are dogsled and snowmobile racing and traditional Arctic games. Outdoor activities, including hunting, fishing, hiking, and kayaking, attract visitors to the territory. Large areas of the territory are set aside as protected areas, including Quttinirpaaq National Park on Ellesmere Island; Auyuittuq National Park on Baffin Island; Sirmilik National Park on northern Baffin Island and Bylot Island; Ukkusiksalik National Park on the mainland; Queen Maud Gulf Migratory Bird Sanctuary, also on the mainland; and Thelon Wildlife Sanctuary, shared with the Northwest Territories.

Several weekly newspapers are published in the territory, both in English and in Inuktitut. A number of radio and television stations broadcast a variety of programming. Broadcasting in Inuktitut is well established.

This portion of the article covers the history of what is now Nunavut from the late 20th century. For earlier history of the region, see Northwest Territories: History (Northwest Territories).

By the mid-20th century most of the region, then a part of the Northwest Territories, had replaced their seminomadic hunting, fishing, and trapping lifestyle with a more sedentary style of living in settled communities, where dependence on government welfare support became the norm. Nutrition and health care improved, but there also were serious social problems related to alcohol and other substance abuse, unemployment, and crime. Dissatisfaction with those conditions and the wish to participate more directly in the processes of resource development led the Inuit to exert pressure on the federal and territorial governments to grant them greater control over the administration of their own affairs. In the mid-1970s the Inuit began negotiations to settle land claims and proposed the creation of a separate Inuit territory. A plebiscite in the Northwest Territories in 1992 approved the division of the territories. With that mandate, the Inuit and representatives of the federal government reached an agreement that produced two acts of the Canadian Parliament in 1993. The first, the Nunavut Land Claims Agreement Act, settled Inuit land claims against the government by giving the Inuit outright control of more than 135,000 square miles (350,000 square km) of territory and providing cash payments from the federal government over a 14-year period; the second, the Nunavut Act, established the territory of Nunavut out of the eastern portion of the Northwest Territories. Following a transitional period, Nunavut came into being on April 1, 1999.

After its inception, the Nunavut experiment in ethnic-based territorial government had mixed success. The economy grew, but it remained almost entirely dependent on transfers of income from the federal government. Despite a reawakening of native culture and pride, alienation of the territory's youth, unemployment, substance abuse, and other social ills common to the peripheral communities of North America persisted. Native elders, the territorial authorities, and the federal government continued to deal with these challenges in the early years of the 21st century.