Dual international Folau, who scored a hat-trick of tries in the Waratahs' season-opener against the Perth-based Western Force last week, crossed over in the second minute and again in the 25th minute before winger Peter Betham scored a third seven minutes from half-time.
The Reds posted their only score when winger Lachie Turner capitalised on lapse defence to touch down in the right corner a minute before the break, but were on the back foot again when inside centre Kurtley Beale notched the Waratahs' fourth try six minutes into the second half.
Flyhalf Bernard Foley slotted two penalties to complete the rout as the Waratahs remained undefeated after two games while celebrating their biggest winning margin over the Reds in the southern hemisphere competition.
Meanwhile, the ACT Brumbies set up a 27-14 away win over the Western Force with a blitzkreig start to their Super Rugby match in Perth on Saturday.
Lock Scott Fardy, fullback Jesse Mogg and winger Robbie Coleman scored tries in the opening 22 minutes as the Canberra-based Brumbies went to the break 24-0 up after completely dominating the first half.
The visitors, who notched their first win of the season in their second game, eased up in the final minutes, allowing the Force to notch two soft tries to add some respectability to the scoreline.
Winless after two games, the Force were kept scoreless until the 77th minute when replacement back Jayden Hayward crossed over after a dash up the right wing from fullback Luke Morahan.
Number eight Ben McCalman added the Force's second try after the final hooter.
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- Western Force