The Black Ferns’ defeat in the 18th meeting between the teams means they fall out of the top two in the rankings for the first time.
Fancy Bermudez scored twice, one in each half, as Canada won the Pacific Four Series title in Christchurch 22-21, despite scrum-half Olivia Apps being sin-binned 10 minutes from time.
New Zealand gained an early lead through Katelyn Vahaakolo, and the winger scored twice on 23 minutes to increase her team’s lead to 14-3, with Ruahei Demant converting both.
However, Bermudez ensured that her team was just 14-10 behind at halftime before McKinley.