Alison Phillips, head of RE at the respected Alsager High School, allegedly disciplined the Year 7 pair, claiming they were disrespectful for refusing to kneel down and pray.
After giving the two boys detention the school was believed to have received several complaints from parents about the long-standing teacher.
A school spokesman said she was suspended over the allegations - but also because of "ongoing inquiries centred around other practical issues".
Joan Feenan, director of Cheshire County Council's children's services, said: "This authority is naturally concerned about complaints we have received from parents.
"Together with the school, we will be thoroughly investigating those complaints, in a careful and considered manner, and informing parents of the conclusions reached.
"Educating children in Christian and other religious beliefs is part of the national curriculum in secular schools and I'm sure that the great majority of our parents welcome any efforts to further mutual understanding.
"Having said that, this authority also accepts without question that such teaching should be carried out with awareness, sensitivity and sound common sense."
She also added that suspension was not a disciplinary measure.
One parent, Karen Williams, said after hearing the claims: "I am absolutely furious my daughter was made to take part in it and I don't find it acceptable."
