Mr Wallace made the claim in a debate on marriage equality with Greens leader Christine Milne at the University of Tasmania on Wednesday.
Answering a question from a student on the relevance of his views, he said health statistics among the gay community were worse than those for smokers.
“I think we’re going to owe smokers a big apology when the homosexual community’s own statistics for its health – which it presents when it wants more money for health – are that is has higher rates of drug-taking, of suicide, it has the life of a male reduced by up to 20 years,” he told the audience.
“The life of smokers is reduced by something like seven to 10 years and yet we tell all our kids at school they shouldn’t smoke.”
After the debate, Mr Wallace said the figures saddened him.
“But what I’m saying is we need to be aware that the homosexual lifestyle carries these problems and … normalising the lifestyle by the attribution of marriage, for instance, has to be considered in what it does encouraging people into it,” he said.
Mr Wallace said legalising same-sex marriage in other countries had not reduced risk factors for gay people.
“Where gay marriage has been introduced, or civil unions, it hasn’t changed the level of suicide,” he said.
“We have to accept the unfortunate levels of suicide, the unfortunate levels of excessive drug use (are) because of the nature of the lifestyle.
“I am very sorry for that. My heart goes out to those people. But it is a fact.”
Senator Milne said discrimination in laws such as the Marriage Act was a contributor to any health concerns.
“What I know is that the mental health issues for young gay people particularly are certainly increased when discrimination occurs,” she told reporters.
There was little love lost between Mr Wallace and Senator Milne during the debate.
Senator Milne accused the ACL of homophobia and said Christians should be more concerned with poverty than homosexuality.
She said with bills before the federal parliament and Tasmania’s lower house last week passing a same-sex marriage bill, change was inevitable.
Mr Wallace accused the Greens of demonising churches with “hate language” and caring more for trees than children.
He described gay activism as “bullying” and said a climate had been created for “legislation by fatigue”.