Israel Folau's multi-million dollar contract is to be torn up by Rugby Australia after he failed to lodge an appeal before the 72-hour window expired.

Wallabies fullback Folau had until Monday afternoon to appeal his high-level code of conduct breach and sanction over his religiously-motivated but controversial social media posts.

"As Folau has not notified the panel of his intention to appeal, the code of conduct process has now formally concluded," Rugby Australia said in a statement.

"With the code of conduct matter complete, Folau's employment contract will be terminated."

It is not known whether Folau will accept the loss of his four-year contract or now pursue the matter in court, as has been speculated.

Last Friday a three-person panel found Folau's contract should be terminated after his Instagram posts, including one proclaiming hell awaits "drunks, homosexuals, adulterers, liars, fornicators, thieves, atheists and idolaters".

That came after Folau had been warned against making such posts before signing his new contract last year. He'd previously posted that hell awaited homosexuals unless they repented.

Rugby Australia CEO Raelene Castle said at the time the decision would have ramifications across the sporting world.

"This is a decision that will change the landscape for sport across Australia and perhaps internationally," she said.

"It will be landmark, it will be important, and it is a big decision.

"He is a very important player in our game and he has been for a long period of time and we wanted to make sure we took the time to get it right."