Townsend had to pull out of the squad for the European Under-21 Championship in Israel after being charged with breaches of the Football Association's rules.
He was fined 18,000 pounds and banned for four months, with three of them suspended, meaning the player will still be available for the start of next season.
Speaking to Friday's Sun newspaper, Townsend said his gambling started as something to while away the boredom of staying in hotels while on loan to Championship sides Leeds United and Birmingham City.
"I was bored and there were TV ads promoting bets you could have on the matches I was watching," he said. "So I downloaded the phone app and started having small wagers to make watching games as a neutral fun.
"I was incredibly naive and didn't realise I was doing anything wrong," he added. "I assumed as long as you weren't betting on your club, then it was OK."
Townsend said there was no match-fixing, or betting on his own team to lose, going on and he had never bet on North London rivals Arsenal to finish higher in the Premier League than Tottenham.
"I was stupid. I'm angry with myself because I've always been proud of how I conduct myself off the pitch," said the player, who has returned to Tottenham after playing for relegated Queens Park Rangers last season.
Townsend said Spurs' manager Andre Villas-Boas had told him not to get downhearted and assured him that the club was supportive and would help him through.
