The U.S. Secret Service ordered Ambassador Gary Doer and the embassy's 325 employees out of the building, located just down the street from the Capitol building, at about 9:30 a.m., said embassy spokesman Chris Plunkett.
The building was given the all-clear an hour later after Secret Service officials investigated and determined the package was not dangerous.
Several police cars and fire trucks descended upon the embassy on Pennsylvania Avenue, a major D.C. roadway that leads to the White House.
Doer and his staff, meantime, gathered in a park next to the embassy.
Foreign Affairs Minister John Baird said that it was premature to speculate on the incident.
"The U.S. Secret Service has a robust presence on the ground to assist our team in dealing with this," Baird said.
"This, regrettably, is a reality, unfortunately, of the life of our diplomats."