The 27-year-old from Eganville, Ont., crossed in one minute 58.12 seconds in a battle down the homestretch.
Bishop had run 1:57.52 in the semifinals, breaking Diane Cummins' Canadian record that stood for 14 years.
"You have to learn how to go through these rounds,'' Bishop said. "In 2012 and 2013 I was still an immature athlete in the sense that I didn't know how to get through them, you live and you learn, and now I have the silver medal around my neck.''
Canada's previous best finish in the event at worlds was Cummins' fifth in 2001.
Marina Arzamasova of Belarus won the gold in 1:58.03, while Eunice Sum took the bronze in 1:58.18.
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