'It means people with unwiped bums,' Sandra Inutiq of the office of the Languages Commissioner of Nunavut was quoted as saying.
'It's not exactly a nice term,' she said.
The Prime Minister's office apologised for the gaffe, calling it a human error that might teach Canadians an important lesson about spelling mistakes, agency reports said.
'Hopefully this unfortunate typo, which we have corrected, will inform the greater public that there is no (extra) 'u' in Iqaluit,' PMO spokesman Dimitri Soudas was quoted as saying.
Major Canadian media outlets also misspelt Iqaluit as Iqualuit.