The aircraft crashed shortly after taking off from the mountain resort town of Pokhara, said Kaski district police chief Gajusiddhi Bajracharya.
"The two were rushed to hospital but the Russian pilot died while undergoing treatment," Bajracharya told AFP.
"Doctors said that the injured Canadian passenger is not critical."
Ultralight flights are popular among tourists in Pokhara for panoramic views of the majestic snow-capped Annapurna mountains -- but accidents are also common.
Last week the wreckage of an ultralight that disappeared in October 2014 with a Russian pilot and a South African tourist on board was recovered near Pokhara.
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