Brazil has experienced some of the highest numbers of COVID-19 cases and deaths globally and from May 2021 made Latin America a pandemic epicenter. Although SARS-CoV-2 established sustained transmission in Brazil early in the pandemic, important gaps remain in our understanding of virus transmission dynamics at the national scale. Here, we describe the genomic epidemiology of SARS-CoV-2 using near-full genomes sampled from 27 Brazilian states and a bordering country - Paraguay. We show that the early stage of the pandemic in Brazil was characterised by the co-circulation of multiple viral lineages, linked to multiple importations predominantly from Europe, and subsequently characterized by large local transmission clusters. As the epidemic progressed under an absence of effective restriction measures, there was a local emergence and onward international spread of Variants of Concern (VOC) and Variants Under Monitoring (VUM), including Gamma (P.1) and Zeta (P.2). In addition, we provide a preliminary genomic overview of the epidemic in Paraguay, showing evidence of importation from Brazil. These data reinforce the usefulness and need for the implementation of widespread genomic surveillance in South America as a toolkit for pandemic monitoring that provides a means to follow the real-time spread of emerging SARS-CoV-2 variants with possible implications for public health and immunization strategies.