The potlatch ban was legislation forbidding the practice of the potlatch passed by the Government of Canada, begun in 1885 and lasting until 1951.

Some first Nations saw the law as an instrument of intolerance and injustice, seeing it as an effort by the Canadian government to extinguish their indigenous traditions and enforce Euro-Canadian culture. Some first Nation groups however, supported the bans.

Though often ignored and circumvented, the ban remained in Canadian legal codes until 1951, when Section 149 was deleted from a revision of the Indian Act. Arrests for charges under the Act were few until 1921, when a raid on the village of Memkumlis held by Chief Dan Cranmer saw the arrest and charges laid against 45 people; of these 22 were given suspended sentences (three were remanded on appeal) and 20 men and women sent to Oakalla Prison in Burnaby. The sentences were two months for first offenders and three months for second offenders.

Potlatch, which means "to give" or "a gift" in the Chinook Jargon, became adapted to refer to "the different ceremonies among [the] many nations of the Pacific Northwest that ... [include] feasting, dancing and giving gifts to all in attendance". It is also described somewhat more completely by The Story of the Masks website from the U'mista Cultural Centre in Alert Bay as "The potlatch refers to the ceremony where families gather and names are given, births are announced, marriages are conducted, and where families mourn the loss of a loved one. The potlatch is also the ceremony where a chief will pass on his rights and privileges to his eldest son."

The British Columbia Indian Office, specifically the Indian Commissioner, I. W. Powell, had found the native peoples to be rich and hardy, but also found they appeared as if they were poor. This finding led to further research on the subject of potlatches where it was found that to the Indigenous peoples of the region, the Potlatch was a great institution. It encouraged people to give away their earnings and possessions (including slaves). In exchange, the giver would receive a great deal of respect and be seen as honourable to his tribe and others.

However, Canadian Prime Minister John A. Macdonald did not see this tradition as valuable or appropriate and, under the guise of unifying the Dominion of Canada, encouraged the government to lay "an iron hand on the shoulders of the [native] people" by restricting some of their non-essential, inappropriate rituals and leading them towards what he perceived as a "healthier" European mindset. Work thus began on an amendment to the Indian Act of 1880. Some criticized the idea, such as James Benjamin McCullagh in his essay on the tribal lifestyle of the indigenous peoples of Canada, "The Indian Potlatch".

In the third section of the Indian Act, signed on April 19, 1884, it was declared that:

Every Indian or other person who engages in or assists in celebrating the Indian festival known as the "Potlatch" or in the Indian dance known as the "Tamanawas" is guilty of a misdemeanor, and liable to imprisonment for a term of not more than six nor less than two months in any gaol or other place of confinement; and every Indian or persons who encourages ... an Indian to get up such a festival ... shall be liable to the same punishment.