While Welby acknowledged that the church schools face particular issue with such bullying as these schools teach the "traditional" Anglican view of marriage, he insisted pupils must be protected.
"When young people are bullied for their perceived or actual sexuality, it is an assault on their self-worth that can leave deep wounds which take many years to heal, if they heal at all," he wrote in an article for the i newspaper.
Justin Welby acknowledged homophobia could be a particular problems for CoE schools
The Archbishop said that the guidance was about "challenging schools to strive towards a deeply accepting environment for all their pupils".
He wrote: "Recognising the profound damage done by words and actions alike, the guidance will urge schools to take a zero-tolerance approach to the victimisation and diminishment of young people through homophobic language or behaviour - which is absolutely anathema to Christian practice."
He added: "At every church school there will be a wide spectrum of beliefs, and this must be acknowledged and respected.
"But schools exist to educate every pupil; the aim of this guidance is to protect pupils in church schools from having their self-worth diminished, and their ability to achieve impeded, by being bullied because of their perceived or actual sexual orientation."
School inspectors will specifically look at how effectively schools are tackling homophobic bullying, he revealed.
Welby, who opposed the gay marriage bill in the House of Lords last year, admitted it was challenging for church schools to tackle homophobia.
"Another challenge for church schools - which must be faced head on - is the complexity of combating homophobic bullying while still teaching the traditional Anglican view of marriage, especially in the light of the revolutionary change to its legal definition for the accommodation of same-sex couples."
The archbishop will launch the guidance entitled Valuing All God's Children at a school in Lewisham, south-east London on Monday.