Burn severity mapping greatly informs fire management and can be used to predict post-fire vegetation recovery. Satellite remote sensing is a cost-effective method for estimating burn severity, providing a comprehensive spatially explicit view of whole landscapes. However, the proportion of tree canopy cover (TCC) affects the reflectance signal, obscuring background char and ash. Consequently, traditional optical satellite remote sensing methods that do not account for variation in TCC misclassify burn severity, especially in areas with extremely low or high TCC. In this study, TCC data served to parameterize and constrain the inversion of the Forest Reflectance and Transmittance (FRT) radiative transfer model (RTM) to alleviate spectral confusion when retrieving burn severity. The methodology was evaluated using field measurements of burn severity for a series of wildfires in the fire-prone tropical savannas of northern Australia and the western United States. Burn severity classes were used for Australia while the Composite Burn Index (CBI) for US. Reflectance data from Sentinel-2A Multi-Spectral Instrument (MSI) and Landsat-5 Thematic Mapper (TM) corresponding to post-fire field survey dates were used to retrieve burn severity using FRT RTM (with and without using TCC information in its parameterization and inversion) and two standard empirical burn indices, dNBR and RdNBR, for comparison. Using FRT RTM without TCC constraint produced an overestimation for low burn severity in regions with low TCC and an underestimation for moderate and high burn severity in regions with high TCC. Burn severity estimation accuracy significantly improved by integrating TCC in the parameterization and inversion of FRT RTM. The overall accuracy in northern Australia increased from 65% to 81%, and the kappa coefficient increased from 0.35 to 0.55. In the western United States, R2 between estimated and observed CBI, increased from 0.33 to 0.54, root mean square error (RMSE) reduced from 0.53 to 0.43, and in all instances, the method performed better than dNBR and RdNBR. The method used in this study achieved more accurate burn severity mapping, thus assisting land managers to better understand post-fire vegetation resilience and forest management. •Current methods based on optical remote sensing data misclassify burn severity in low and high tree canopy covered areas.•Burn severity was retrieved inverting the Forest Reflectance and Transmittance model.•Tree canopy cover was used to constrain the inversion obtaining more accurate results.•Sentinel-2A Vegetation Red Edge bands do not play an important role in burn severity estimation.