Canada's federal system is based on the British parliamentary system. It has two Houses, the House of Commons and the Senate. The House of Commons (as of this writing) contains 301 seats, and is the elected legislature of Canada. The Senate contains 104 seats, and people are appointed to the Senate by the Governor-General of Canada on the recommendations of the Prime Minister and his cabinet.
The real power in Canada is in the Commons -- the Senate is a weaker body, unable to stop legislature from becoming law. The Senate, however can delay legislature for long periods of time, returning it back to the Commons for further amendment.
In Canada, elections must be held at least every 5 years, and are called by the Government then in power. Most times, it's around the 5 year mark -- however, a Government which is defeated on certain types of legislation must call an election (which is why Party discipline is so important), and a Government will sometimes call an election to debate an important piece of public policy. Governments have been known to call elections for political gain (e.g. when Chretien called one a year early to take advantage of chaos within the Opposition parties), but this is strictly frowned upon, and somebody who does it too often will usually get burned at the polls.
When an election is held, people vote for a local representative, who usually represents a party. When the election is finished, the party that holds the most seats is invited to form the Government. The leader of that party becomes Prime Minister, and members of that party form Cabinet, and take control of various Government Departments.
The party that placed second is known as the "Official Opposition", and the rest of the parties that elected members to parliament are known collectively as "The Opposition."
In the Canadian, system, party discipline is strictly enforced; voting against the wishes of the party usually results in that person being ejected from the party. Thus, a Government with a majority of seats can pretty well rule as an absolute dictatorship. However, the opposition, while being unable to outvote the Government, can usually delay things for such a long time that it's in the Government's best interests to compromise with them. As well, the Senate, can act as a delay (as mentioned above), and, if something is particularly heinous, backbenchers (members of Government not in the Cabinet) can (and have!) broken ranks with the party. All these saftey valves, plus the tradition of Parliamentary Democracy in Canada, usually prevent the worst abuses. (For example, when Parliament is in session, it is considered a grievous insult to ever refer to a MP (Member of Parliament) by name. You usually refer to them by their region e.g. "Member for Windsor West". By refering them by name, you imply that they are looking out for their own interests, and not those of their constituents. It doesn't sound like much, but it's considered very embarassing to have happen to yourself, and it helps keep MPs in line.)
Finally, the Canadian system features the 'Governor-General of Canada'. This person represents the Queen, and must sign off on legislation before it becomes law. While in modern times this person is more of a goodwill ambassador, they do represent a final check on the power of the Commons.
The Progressive Conservatives is also another mainstream party, but they got clobbered after one of their leaders (Brian Mulroney) basically destroyed the party to pursue his agenda. They're just to right of centre, but they're in deep trouble, both money and memberhsip-wise -- it's uncertain if they'll survive.
The NDP used to be the third, protest party, on the national stage. They are a socialist/workers party, pursuing activist agendas left of centre. They've been marginalized because of the demographic shift, and, they're currently in the middle of a process to decide where they want to go from here. They're also in danger of disappearing of tfhe political map.
The Bloc Quebecois is a strictly regional party (they only run candidates in Quebec), and are dedicated to Quebec's interests above all else. Their goal is to help facilitate Quebec's separation from Confederation. Their political spectrum is slightly left, but it's coloured by the overtones of the Separtist debate.
The Alliance started as a regional party, born out of the Canadian West, as a protest against the 'mainstream' parties in Canada. (The PCs, Liberals, and NDPs support is all east, Ontario or the Maritimes.) They've made large inroads, and have basically replaced the PCs as the right wing option party. However, they've been having image problems, and they're probably too far right for most Canadian's tastes, at least in the East. So, for the moment, they're still considered regional, though they have the potential of becoming national.
I think that's everything I wanted to say. (8-) If you have any questions, please ask, or, you can surf the web for more information then you can ever want. (It's politics, right? Everybody's got an opinion. (8-) )