The short answer to whether you can use U.S. dollars to pay for stuff in Canada is probably.
However, you can't do it everywhere and it may be expensive to do so.
Canada and the United States have a longstanding, healthy relationship. The robust economic trade and tourist activity between the two countries result in a steady stream of people moving over the Canada/U.S. border.
Despite these close ties, Canada is its own country with a protected border and its own government, laws, and currency, which is the Canadian dollar.
Though many major retailers and hotels will allow customers to pay with U.S. currency, smaller or more rural destinations may not want to be saddled with a foreign currency and will therefore not accept it.
Retailers that do accept U.S. dollars can set their own exchange rate, which will not likely be favorable to the customer.
Border crossings, border towns and the Canada's most popular destinations and attractions will readily accept U.S. currency and probably give a decent exchange, but for outside of these, have some Canadian cash on hand or credit card.
Automated machines, such as parking meters, laundromats or anything into which you must insert the money will likely only accept Canadian money.
Best advice for people arriving in Canada is to get some of the local currency: you can do this at an exchange kiosk or for a better exchange, go to a Canadian bank. In addition, you can use your credit card (Visa and Master Card are most widely accepted) for point of purchase or your ATM to draw Canadian dollars from your U.S. account.
Try to maximize the amount of money you withdraw from an ATM to cut down on withdrawal fees.