Cody, who also appeared in the Instagram Live video, was played a clip of the shocking "gay" comments by the show's hosts, and asked to clarify what Miley had meant.
In response, Cody defended Miley and said: "Yeah she.... people took that the wrong way I think."
The Project host Carrie Bickmore went on to say that Miley had posted an apology on Twitter to fans about her comments, which had clarified what she actually meant.
"I was talking s**t about sucky guys, but let me be clear, YOU don't CHOOSE your sexuality," Miley tweeted.
"You are born as you are. It has always been my priority to protect the LGBTQ community I am a part of."
Carrie went on to probe Cody about Miley's mindset and asked: "Have you had a chance to talk to her [Miley] today?"
Cody dodged Carrie's question, but instead he backed up Miley's apologetic Twitter statement.
"Absolutely you don't choose who you fall for or who you love, whatever gender or who you are," he said.
The Australian singer added of Miley: "But no, she's wonderful. So..." before trailing off, with the show's hosts moving onto another topic.
Miley, who came out as pansexual in 2015 - a term which refers to when a person is attracted to others regardless of their of their sex or gender identity - has been in the spotlight since her nasty split with her husband Liam Hemsworth in August.
Since their breakup she has paraded her relationships in front of the public, including a dalliance with Kaitlynn Carter, before getting together with Cody.
The 'Wrecking Ball' singer went public with her relationship with Cody, who she's known for a number of years, in early October.