The Chelsea defender had been charged on July 27 with using abusive and/or insulting words and/or behaviour which included a reference to colour and/or race, in relation to Queens Park Rangers' Anton Ferdinand.
The case had been put on hold pending the outcome of a criminal trial into the matter, at which Terry was found not guilty of racially abusing Ferdinand.
The commission ruled that Terry be suspended from all domestic club football for four games and fined £220,000, pending an appeal.
Terry has the right to appeal within 14 days of the written reasons for the decision being given.
The penalty is suspended until the outcome of any appeal, or the time for appealing expires, or if Terry does not decide to appeal.
It is believed that Terry will lodge an appeal, allowing him to play for Chelsea against London rivals Arsenal this weekend.
Terry earlier this week retired from international football, claiming that the FA's decision to pursue the investigation despite his 'not guilty' verdict had made his position in the England side untenable.