Officials confirmed to ESPN.com the suspension, which came after Diaz referred to Caraway using a homophobic slur, writing, "the biggest F-- in the world."
"We are very disappointed by Nate Diaz's comments, which are in no way reflective of our organization," the UFC stated in a release. "Nate is currently suspended pending internal investigation and we will provide further comment once the matter has been decided."
Diaz's manager, Mike Kogan, declined comment to ESPN.com until he spoke with the UFC.
Diaz (16-9) posted two entries on his Twitter account, sympathizing with lightweight Pat Healy, who recently forfeited $130,000 in bonus money after testing positive for marijuana following a submission win over Jim Miller at UFC 159. The $65,000 bonus he received for Submission of the Night was awarded to Caraway, who finished Johnny Bedford that night via guillotine choke.
In an interview since, Caraway stated he is against the use of marijuana completely.
Diaz's full post read: "I feel bad for Pat Healy that they took a innocent man's money and I think the guy who took the money is the biggest F-- in the world .."
Healy's win over Miller was changed to a no-contest, and Healy received a 90-day suspension. Diaz's older brother, Nick, a UFC welterweight, has been suspended twice previously for marijuana-related offenses.
In addition to losing the bonus money, the UFC states its right to discipline fighters for "derogatory or offensive conduct, including sexual orientation," in its code and conduct policy.
Diaz last fought at a UFC on Fox event on April 20. He suffered a second-round TKO loss to Josh Thomson. He contended for the 155-pound belt in December 2012, losing a unanimous decision to champion Ben Henderson.