The clause, part of the Local Government Act 1988, was one of the key battlegrounds between left-wing Labour councils and Margaret Thatcher's government. It has never been tested in the courts.
A new policy document published by the BMA this week claims the clause, more recently included in the Education Act 1993, is having the opposite effect from that intended by the government when it was introduced.
Far from preventing young people from experimenting with their sexuality or having sex at a young age, lack of education and information is actually more likely to make them do so, the BMA says.
School governing bodies and teaching staff were not meant to be included.
The report says good sex education which teaches about all forms of sexuality actually delays the age at which first intercourse happens and leads to fewer unwanted pregnancies and sexually transmitted diseases.
The BMA says: 'The wording of s28 is vague and ill defined and its meaning has caused much confusion and concern. The Education Act 1993 makes it clear that s28 applies to local authorities and not school governing governing bodies or staff.
'The Education (No 2) Act 1986 and subsequent legislation designates the school governing body and not the local authority as being responsible for sex education.
'However, there is a great level of ignorance about its applicability and it is often wrongly advanced as a reason for not teaching about homosexuality.
'Due to the harmful effects of the section and as it is so poorly worded it is doubtful whether it has any real applicability even outside schools, [and] it should be repealed.'