The Australian full-back, who holds a traditional Christian understanding of the issue, replied to a question on Instagram which asked what God's plan was for gay people.
He replied: "HELL...Unless they repent of their sins and turn to God."
Despite deleting the post, an image of his comment has been shared online thousands of times.
His employer, Rugby Australia, had said his comments "did not reflect the views" of the organisation but on Tuesday the organisation's boss said: "In his own words, Israel said that he did not intend to upset people intentionally or bring hurt to the game. We accept Israel's position."
Folau had defended his comments on the Players Voice website.
In a long article in which he talks about the basics of Christianity, he said: "People's lives are not for me to judge. Only God can do that.
"I have sinned many times in my life. I take responsibility for those sins and ask for forgiveness through repentance daily."
Speaking about his views on homosexuality and sin, he went on to say he was unprepared to "compromise my faith in Jesus Christ, which is the cornerstone of every single thing in my life".
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