This ain’t no fake – according to Snopes Sly really took it all off for a porno film before hitting it big:
New York City was the hub of U.S. porn film making. Stallone is the leading man in this X film, and he later acknowledged in a Playboy interview that he was paid $200 for his role. Unlike his efforts in later films, Stallone seems to have had no part in directing or producing Party at Kitty and Stud’s.
Check out his really NSFW pics from the porn (including boners!) as well as Demolition Man after the jump.