Folau, 25, was voted the Wallabies' best player by his Test team-mates in just his second season in the 15-man code.
Wallabies players voted on a 3-2-1 basis after every Test from last year's Spring tour up until Saturday's third Bledisloe Cup clash in Brisbane.
The dual international polled 314 votes to finish ahead of his Waratahs team mate Michael Hooper (232), Reds prop James Slipper (208) and Brumbies duo Tevita Kuridrani (202) and Stephen Moore (98).
Folau was also named joint winner of the Australian Super Rugby Player of the Year award alongside Hooper, who won both the Super Rugby player of the year and John Eales medal last season.
"Israel Folau is one of the most exciting players in world Rugby at the moment and his performances over the last 12 months make him a worthy recipient of this award," ARU boss Bill Pulver said.
"On behalf of the wider Australian Rugby community, we congratulate Israel on being named the 2014 John Eales Medallist and wish him all the best for the forthcoming Spring Tour."
The Wallabies leave for their five game tour against the Barbarians, Wales, France, Ireland and England on Friday afternoon.
Other major award winners include:
Wallabies Rookie of the Year: Sam Carter
Australia's Choice – Wallaby of the Year: Michael Hooper
Wallabies Hall of Fame: Wylie Breckenridge, Greg Davis and Simon Poidevin
Super Rugby Player of the Year: Joint winners - Israel Folau (NSW Waratahs) and Michael Hooper (NSW Waratahs)
Super Rugby Team of the Year: NSW Waratahs
Super Rugby Coach of the Year: Michael Cheika (NSW Waratahs)
Super Rugby Rookie of the Year: Sean McMahon (Melbourne Rebels)
Super Rugby Referee of the Year: Steve Walsh
Australian U20s Player of the Year: Sean McMahon
The Shawn Mackay Award - Sevens Player of the Year: Emilee Cherry
Men's Sevens Player of the Year: Cameron Clark
Women's Player of the Year: Emilee Cherry
Buildcorp NRC Player of the Series: Sean McMahon