Steve Smith banned by ICC over cricket ball-tampering scandal as he, David Warner relinquish leadership positions

Steve Smith has been suspended by the ICC for one Test and fined his entire match fee over the Australian ball-tampering scandal.

Cameron Bancroft has also been fined 75 per cent of his match fee and issued three demerit points.

The punishment from world cricket's governing body came after both Smith and David Warner were stood down as Australian captain and vice-captain for the remainder of the third Test against South Africa in Cape Town

The shell-shocked tourists capitulated to a 322-run loss, collapsing to be all out for 107. South Africa now leads the four-Test series 2-1 with the final Test beginning in Johannesburg on Friday night Australian time.

The sanctions followed the ball-tampering scandal on day three, where Smith instructed Cameron Bancroft to tamper with the ball during South Africa's second innings.

In a statement, ICC chief executive David Richardson said the charge against Smith fell under rules prohibiting all types of conduct of a serious nature contrary to the spirit of the game.

"The decision made by the leadership group of the Australian team to act in this way is clearly contrary to the spirit of the game, risks causing significant damage to the integrity of the match, the players and the sport itself and is therefore 'serious' in nature," Richardson said.

"The game needs to have a hard look at itself. In recent weeks we have seen incidents of ugly sledging, send-offs, dissent against umpires' decisions, a walk-off, ball tampering and some ordinary off-field behaviour."

Cricket Australia said in a statement that both Smith and Warner had agreed to stand down from leadership duties, with an investigation to be conducted "with the urgency that it demands".

"Cricket Australia and Australian cricket fans expect certain standards of conduct from cricketers representing our country, and on this occasion these standards have not been met," Cricket Australia chief executive James Sutherland said in the statement.

"All Australians, like us, want answers and we will keep you updated on our findings, as a matter of priority."

 Smith did not participate in the team warm-up, staying in the sheds before the players came together on the field as the news of their standing down emerged.

How ball-tampering incident unfolded

Australian cricket team captain Steve Smith and senior players planned the ball-tampering plot during a lunch break. This is how it played out.

The incident, which saw Cameron Bancroft rubbing a piece of tape along the ball before dropping the tape down his trousers when footage of the tampering appeared on the big screens, prompted Cricket Australia to send officials to South Africa to investigate the incident.

Bancroft admitted to the offence and was charged by match officials, while Smith initially said he would not be standing down as captain.

In an emotional media conference in Melbourne, Sutherland admitted it was a dark day for the game in Australia, with players and staff letting their supporters down.

"Australian cricket fans want to be proud of their cricket team," he said.

"I think this morning, they have every reason to wake up and not be proud of the team.

"It's a very sad day for Australian cricket.

"One of the unique things about the game of cricket is that it's to be played not only within the laws of the game, but in the spirit of the game.

PHOTO: Cameron Bancroft talks to the umpires on the field after footage of the ball tampering emerged. (AP: Halden Krog)

"And activities on the field yesterday in Cape Town are neither within the laws of the game or within the spirit of the game.

"And for us, at Cricket Australia, that's extremely disappointing, but more importantly, for Australian cricket fans, it's extremely disappointing as well."