The case has become heavily politicized in Northern Ireland with members of the province's largest political party, the Democratic Unionist Party, proposing the introduction of a Conscience Clause Bill to allow the withholding of services on grounds of religious belief.
Northern Ireland's Deputy First Minister Martin McGuinness, a member of the Irish nationalist party Sinn Fein, welcomed the judgment as "a good result for equality".
Gay rights activist Gareth Lee took Ashers Baking Company in Belfast to court in a civil action after it canceled his order for a cake with the slogan "Support Gay Marriage" on it. The case was funded by the British province's Equality Commission.
The firm initially accepted the order but later contacted Lee to cancel it and refund his money. Lee told a court hearing over three days in March that the bakery's refusal made him feel "unworthy" and "a lesser person".
Speaking outside the court just before the judgment on Tuesday, bakery owner Daniel McArthur said: "We happily serve everyone but we cannot promote a cause that goes against what the Bible says about marriage."
In her judgment, District Judge Isobel Brownlie said that while the defendants had a right to religious beliefs "they are limited as to how they manifest them".
For it to be otherwise "would be to allow religious belief to dictate what the law is," she added.
The court found that Ashers had discriminated against Lee on the grounds of his sexual orientation as well as his political beliefs and ordered the bakery to pay £500 ($776).
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