"Similarly,Mr Folau did not intend to hurt or harm the game of rugby and acknowledges and apologises for any hurt or harm caused,"the two parties said in a joint statement issued on Wednesday afternoon.
Folau and his team were delighted with the outcome,a source close to his camp said.
Folau claimed he was unlawfully sacked because of his religion in May this year.
RA maintains Folau breached the professional players'code of conduct with two social media posts condemning homosexuals to Hell and labelling as"evil"the legal recognition of transgender and intersex Australians.
The parties released a joint statement,saying:
"The Social Media Post reflected Mr Folau’s genuinely held religious beliefs,and Mr Folau did not intend to harm or offend any person when he uploaded the Social Media Post.
"Mr Folau wants all Australians to know that he does not condone discrimination of any kind against any person on the grounds of their sexuality and that he shares Rugby Australia’s commitment to inclusiveness and diversity.