The sketch was conceived when SCTV moved to the CBC television network. Due to the difference in the amount of time allocated for commercials, each episode to be broadcast on that network was two minutes longer than those syndicated to the United States. The CBC network heads asked the show's producers to add specifically identifiably Canadian content for those two minutes. Rick Moranis and Dave Thomas thought that this was a ridiculous request, given that the show had been taped in Canada, with a mostly Canadian cast and crew, for two years. The request inspired them to create a parody that would incorporate every aspect of the humorous stereotype of Canadians.
The segments were videotaped at the end of a day's shooting, with just Thomas and Moranis and a single camera operator. The sketches were for the most part improvised on the set, after which they would select the best ones for use on the program.
Moranis recalled, "We went on the stage with no preparation, and did 15 [sketches]. Two of them were lousy, in three we cracked up and fell apart... maybe six were keepers." Added Dave Thomas in a 2000 interview, "Rick and I used to sit in the studio, by ourselves – almost like happy hour – drink real beers, cook back bacon, literally make hot snack food for ourselves while we improvised and just talked. It was all very low key and stupid, and we thought, 'Well, they get what they deserve. This is their Canadian content. I hope they like it.'"
To their shock, the comedians found that this filler material had become the most popular part of the show. Though initially intended for Canadian TV only, some of the two-minute "Great White North" segments would find their way into U.S. versions of the 30-minute shows due to a shortage of content that week. When NBC ordered the 90-minute shows for the 1981 season, they specifically cited good affiliate feedback on the "two dumb Canadian characters" and requested that the characters be included in every program.