AbstractPopulation testing remains central to COVID-19 control and surveillance, with countries increasingly using antigen tests rather than molecular tests. Here we describe a SARS-CoV-2 variant that escapes N antigen tests due to multiple disruptive amino-acid substitutions in the N protein. By fitting a multistrain compartmental model to genomic and epidemiological data, we show that widespread antigen testing in the Italian region of Veneto favored the undetected spread of the antigen-escape variant compared to the rest of Italy. We highlight novel limitations of widespread antigen testing in the absence of molecular testing for diagnostic or confirmatory purposes. Notably, we find that genomic surveillance systems which rely on antigen population testing to identify samples for sequencing will bias detection of escape antigen test variants. Together, these findings highlight the importance of retaining molecular testing for surveillance purposes, including in contexts where the use of antigen tests is widespread.