The aircraft clipped a fence behind Vernon's Ellison Elementary School, hit the tree and crashed a few metres from school property just before 9 a.m. PT.
Made by a Florida company, the flying car is a combination of a plane engine, propeller and parasail attached to a dune buggy.
RCMP spokesperson Gord Molendyk said there are indications the contraption had taken off from the airport in Vernon.
"It looked like it was on its approach," Molendyk said. "There was motor sound and people looked up and it got into trouble and came through the fence and into the trees here."
Molendyk said the pilot and his passenger had to be pulled from the tree. They suffered minor injuries and were taken to hospital. They have since been released.
No one was hurt on the ground, although children from the school were preparing on the nearby grounds for a track and field day.
It's believed Kelowna, B.C., resident Ray Siebring recently brought the fifth-ever flying car to Canada as a prototype and has been checking it out in a series of test flights across the Okanagan.
A release from the Transportation Safety Board (TSB) confirmed the flying car was "an American corporately registered I-Tech Maverick SP Powered Parachute" that had crashed.
The vehicle, known as "Maverick," uses a 100-metre runway to take off and flies under a parasail. But it also needs a 100-metre runway to make a safe landing.
According to the manufacturer's website, the car can travel at speeds up to 160 kilometres per hour on land and up to 65 kilometres per hour in the air. It costs at least $94,000 to purchase, according to the site.
The TSB is now investigating.