The image, blazoned across the Belfast SSE Arena, showed Fury's head superimposed onto a dancer's body and wearing make-up over a rainbow background. The slogan reads: "Don't be furious, be fabulous!".
Paddy Power also tweeted images of the projection at Tyson Fury, saying: "Hey @Tyson_Fury , hope you saw this on your way into #BBCSPOTY tonight!"
The stunt is in reference to Fury's alleged homophobic and sexist remarks in recent months. He has called for homosexuality and abortions to be made criminal offences, and said both were as socially unacceptable as pedophilia. He has also described two fellow boxers as "gay lovers".
He subsequently denied that any of his comments were homophobic or sexist, though he last night apologised for comments that may have "hurt anybody".
Fury's nomination for the BBC Sports Personality of the Year Award resulted in a small group of protesters picketing the venue ahead of the awards. The award eventually went to Andy Murray.
Paddy Power's stunt ties in with its wider 'Rainbow Laces' anti-homophobia campaign, which has been running since 2013 in partnership with Stonewall. Focused on football, the original campaign saw the firm send rainbow-coloured bootlaces to all 134 professional clubs in the UK for players to show their support for gay teammates.