The team will still be allowed to play the Junior Vase final at Twickenham
Liskeard-Looe have been fined £2,500 by an RFU disciplinary panel after admitting publishing racially offensive material in a programme.
The Cornish club admitted a charge of publishing profane and offensive material and a second of publishing racially offensive content.
The comments came in their programme for their EDF Junior Vase semi-final on Saturday, 22 March.
It means the club will still be able to play at Twickenham on 9 May.
"This is an extremely serious case. As the club recognised in the hearing, the offending material brought the game into disrepute," said the panel chairman Chris Quinlan.
Such material damages the reputation of the Game, which is rightly proud of its image as a wholesome, clean, fair, family orientated sport, open and welcoming to all. Racism and homophobia have absolutely no place in Rugby Union
RFU disciplinary panel chairman Chris Quinlan
"Why such material was ever published is beyond our comprehension," he added.
In addition to the fine, the club will also have to write letters of unreserved apology to the chairman and chief executive of sponsors EDF Energy and the chairman of opponents Lowestoft and Yarmouth.
The club will also have to publish an unreserved apology in the local media and on the club's website for 28 days from Wednesday, 1 April.
"Such material damages the reputation of the game, which is rightly proud of its image as a wholesome, clean, fair, family orientated sport, open and welcoming to all. Racism and homophobia have absolutely no place in rugby union," added Quinlan.
"However, we did take on board the club's regret and distress that the material was published in its' name. We were also conscious that the club has earned a place in a Twickenham final on 9 May in what will be the biggest game in its history.
"Having regard to the circumstances of this case, it was decided that the appropriate sanction was a financial penalty, payable within 28 days," he said.
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