PayPal is backing out on its original plan to open a North Carolina-based facility in the near future.
The new facility, which was slated to be a global operations center, was expected to employ 400 people.
PayPal has long been a supporter of LGBT rights and its CEO, Dan Schulman, said as much in a statement.
"We will stand firm in our commitment to equality and inclusion.
It's the right thing to do for our employees, our customers, and our communities."
Hundreds of companies have joined PayPal in protest of the controversial legislation, which mandates that students use the bathroom that corresponds with their born gender.
The measure has been criticized for excluding gays and transgender people from legal protections.
