The RCMP said the investigation dubbed Project Cranium involved the U.S. Secret Service, the RCMP and Surete du Quebec.
The force said four arrests were made and that the raids made Wednesday in the Trois-Rivieres and Drummondville areas dismantled a crime group able to produce millions of dollars in phoney currency.
"The RCMP alleges that the counterfeiting ring had the capability to produce very high quality counterfeit bank notes that were basically undetectable to the naked eye," the Mounties said in a release.
"Not only is this alleged ring believed to have distributed large amounts of counterfeit bank notes in Quebec, but similar bank notes have also been traced by the US Secret Service in several US cities and in other countries."
Police said they seized $949,000 in phoney US$20 bank notes.
They said they also uncovered a laboratory mainly used to add finishing touches to counterfeit notes like serial numbers and holographic features.
The RCMP release said the fake notes were printed using an offset press with non-sequential serial numbers, which police called "rather uncommon" for a counterfeit operation.
Among those arrested was 42-year-old Trois-Rivieres resident Francois Bourassa.
RCMP said he faces charges of production, possession and distribution of counterfeit currency.
Police said the other three suspects arrested could face prosecution in Canada or the United States