The 7th Genie Awards were held on March 20, 1986, at the Metro Toronto Convention Centre to honour achievements in Canadian film in 1985. The ceremony was co-hosted by actors Leslie Nielsen and Catherine Mary Stewart.^[3]

After years of excluding foreign members of Canadian film productions from eligibility, everyone could now compete equally. For the first time in the Genies' history, all of the top contenders were well-known films. Voters chose from a strong slate of contenders, although Phillip Borsos not receiving a nomination in the directing category for One Magic Christmas was analyzed as a snub.^[4] Jay Scott of The Globe and Mail also initially labelled the lack of a Best Documentary nomination for Donald Brittain's Canada's Sweetheart: The Saga of Hal C. Banks as a snub;^[5] however, as it had been distributed primarily as a television broadcast rather than in theatres, it was instead treated as a television film and received numerous nominations at the Academy's 1st Gemini Awards later the same year.^[6]

The academy presented two Special Achievement awards, the first to IMAX president and co-founder Graeme Ferguson. The second was to Judith Crawley and Radford 'Budge' Crawley in recognition of 40 years of contributions to the Canadian film industry. They couple began their career making training films for the National Film Board of Canada; by the 1950s, Crawley Films was the largest independent production company in Canada. Their 1975 film The Man Who Skied Down Everest was the first Canadian feature-length documentary to win an Oscar.^[7][4]