Nunavik is a subarctic remote region covering the northern third of Québec, Canada, where low efficiency and environmentally adverse diesel furnaces are currently used to meet residential heating demand. Studies focusing on building heating alternatives in subarctic climate are limited and hence, this work can help with the development of such systems in remote off-grid communities. Shallow geothermal potential was mapped for Kuujjuaq, the largest village in Nunavik. Four ground-coupled heat pump scenarios were analysed for a simulated 5-occupant residential dwelling, with heating needs of 71 MWh/year. Resulting maps show a relatively high ground potential for such cold region, ranging between 5.8 MWh/year and 22.9 MWh/year per borehole for heat exchanger lengths of 100 m–300 m. A 50-year life-cycle cost analysis of such systems reveal that a compression heat pump with electricity derived from solar photovoltaic panels has a net present cost as low as approximately CAD$179,000, representing the most economically attractive heating option in Kuujjuaq as compared to the currently subsidized, diesel furnace heating at CAD$277,000. This work verifies that shallow geothermal energy through state-of-the-art heat pumps is a financially interesting option in Kuujjuaq. Results can be extended to similar subarctic settings in Canada and worldwide.