Canada is often touted as one of the ideal examples of multicultural diversity management. This thesis mainly researches the gap between this idealised image and internal multicultural policies, especially in the case of cultural diplomacy. It follows the argument based on the Charles Taylors theory of recognition that, identify formation is strongly influenced by the recognition of the existence and value of the culture and identity of a distinct group. Governments, through cultural diplomacy, must recognise and include minorities as unique and valued cultures, and ensure their participation in the external presentation of national identity. In the theoretical part this thesis presents an ideal model combining multicultural reality, multicultural policies and cultural diplomacy in which cultural diplomacy contributes to the realization of multicultural policies by following the principles of multiculturalism that affect cultural recognition. The presentation of national identity abroad include the perspectives of minority identities as well as allow the presentation of the past wrongdoings against distinct groups and their perspective of the past. Such practice is the only way for a state to prove its multicultural orientation in the field of cultural diplomacy. Following this ideal model, the thesis in empirical part examines the case of Canada, and provides a comparative perspective with Slovenia. Through the elements of the analytical model, it shows that Canada has implemented multicultural policies on several levels of governance, however it has failed to implement them while presenting its internal ethnic diversity abroad. The case of Canadian identitys presentation at the Olympic games in Vancouver shows a unique example of good practice however despite this, Canada still fails to consistently follow the example it set at the Olympic Games in Vancouver. Comparatively, it is not surprising that Slovenia as ethnically relatively homogenous country, also fails to include its minorities in presenting its multi-ethnic reality abroad, including through cultural diplomacy.