Roger Wade, founder of Boxpark, attended Brighton’s match against Fulham at the Amex Stadium on August 16.
He said he was "bitterly disappointed" in the club for the five-match ban, after he showed off the shirt on two occasions and then refused to comply with stewards' requests to step outside.
But the Albion has said no supporters have ever been banned for wearing football shirts of countries in current conflicts, despite Premier League rules prohibiting this.
Mr Wade claimed he was "treated unfairly" when "a simple and respectful request to keep my shirt covered, something I had already done voluntarily, would have resolved the situation".
He said: “I have requested three simple things: an apology for how I was treated, that my ban be rescinded and clear guidance on the wearing of international football shirts at the stadium.”
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Before the match, the season ticket holder took his jacket off on the way to his seat behind the players' dugout, and posed for a photo in the shirt.
He said he was taking a stand against what he described as "the killing of over 50,000 innocent civilians in Gaza and the deliberate starvation of over two million people", while also sympathising with the "atrocities" of the October 7 Hamas terrorist attack.
During the half-time interval, in the Dugout hospitality bar, Mr Wade - who said he had covered up his shirt at this stage - was approached by stewards.
They asked to speak with him in the West Stand Reception, in line with the club's policy to offer individuals privacy.
Mr Wade refused this several times, unbuttoned his jacket - exposing the Palestine shirt - and began filming the interaction.
During part of the exchange with a steward, he said: "Why have you singled me out, and why am I not allowed to go back in?
"Why am I not allowed to go to my seat sir?"
In response, the steward said: "Because of the way you've conducted yourself."
The entrepreneur then said that he eventually covered the shirt back up and watched the match without further incident.
Afterwards he submitted a complaint to the club, and was then banned for five matches.
He has since submitted a formal objection against the decision.
Premier League rules state that flags, banners or other materials that display potential inflammatory content, such as flags of countries in conflict, are not allowed.
He said: “I stand firmly against the killing of over 50,000 innocent civilians in Gaza and the deliberate starvation of over two million people. At the same time, I also condemn the horrific atrocities of October 7.
“In solidarity with the Palestinian cause, I chose to wear a Palestine football shirt at the opening game of the season.
“That same week, UEFA displayed a banner in support of Palestine at the UEFA Super Cup, and the UK government announced that it would recognise the state of Palestine next month.
“I checked the Premier League rules in advance and confirmed that international shirts are not banned, unless they carry political messages. My shirt carried none."
Brighton and Hove Albion shared a statement on its website which said: “The Premier League is clear on guidance to all its clubs in that flags, banners or other materials (including replica shirts and t-shirts) that display potential inflammatory content, which could include flags of countries in conflict, or content considered discriminatory, offensive or politically motivated, should not be permitted.
“While we fully appreciate we have a diverse fan base, who have differing views on many local, national and international issues, we also have a duty to comply with Premier League regulations.
“Nonetheless, our typical approach is initially to politely and privately highlight and remind any supporters who may breach these rules, inadvertently or deliberately.
"Individuals unwilling to comply with our stewards’ requests in relation to these rules, or any other ground regulations, could find themselves liable to further sanctions.
“We can confirm the majority of our supporters comply with these rules, and despite some media reports and social media comments to the contrary, to date no supporter has been sanctioned for failing to comply with the Premier League rules on displaying flags or other materials representing countries in conflict.”