Palaeosaniwa is among the largest terrestrial lizards known from the Mesozoic era, with an estimated body mass of 6 kg (13 lb) and a snout–vent length about 82 cm (32 in).

P. canadensis is estimated to have skull length up to 15 centimetres (5.9 in) which is comparable to a young specimen of komodo dragon around 1.6 m (5.2 ft) long.

These teeth would have been effective for seizing and cutting large prey items, and suggest that Palaeosaniwa fed on other vertebrates.

Palaeosaniwa is a member of the Platynota, a group that includes the monitor lizards (Varanidae) and Gila monsters (Helodermatidae).

Its precise affinities remain poorly understood, but it may be related to other Late Cretaceous, North American carnivorous lizards such as Parasaniwa, Paraderma, Labrodioctes, and Cemeterius.