The 38-year-old was found guilty of seven match-fixing charges by an independent tribunal last week and the sanction imposed today.
Lee, the former world number five, was found guilty of match-fixing charges relating to seven matches in 2008 and 2009.
The WPBSA had been seeking a lifetime ban but the organisation’s head of disciplinary Nigel Mawer insisted the 12-year suspension was effectively the same thing.
Mawer said: “We did say we were seeking a life ban because if it was seven matches that had been fixed including during the world championships.
“But in effect it is a life ban because I think it is highly unlikely that Stephen Lee will be able to come back to the sport at this level.
“We don’t take great pleasure out of that - this is a case of a fantastic snooker player who has thrown it all away through making the wrong decisions.
“It is only human to have a degree of sympathy for him and it is going to be very difficult for him but we have to send a very strong message that match-fixing is not going to be tolerated.
“To my knowledge this is the longest ban ever handed down and there are £40,000 costs to pay too if he ever wants to come back.”
Mawer added that he believed snooker was overwhelmingly a clean sport.
He said: “I am independent and outside the organisation and have a law enforcement background, and all the intelligence on irregular betting come to me.
“Hand on heart I believe it is a very, very clean sport - I have only had to investigate four incidents in 7,000 matches and two of those have led to suspensions, which puts it in context.”