The 21-year old, who spent the second half of last season on loan with QPR, has admitted to the charge of betting on football and has been ordered to stay away from the game for the next month with the remaining three months suspended until July 1, 2016.
Townsend has also been fined £18,000 and withdrew from the England U21 squad for the European Championships in Israel.
"Following a personal hearing at the FA and the statement issued earlier today, I fully accept the disciplinary action and shall not be appealing,” read a statement from Townsend.
"This has been a regrettable experience from which I fully intend to come back stronger. I am now fully focussed on returning to football during pre-season and determined for this indiscretion to not tarnish my career moving forward."