On folly is a slang term used heavily by gang members, especially those in the Chicago area. Being on folly means you're down with the criminal life, and ready to do whatever is necessary. For example someone who's posted up in a cut with 223s is on folly, someone who's ready to catch a body is on folly, someone who attends parties with 30 poppas is on folly. The term is similar to saying someone is on dummy.
Folly is a regular English word that is described by the Merrian Webster Dictionary as "Lack of good sense or normal prudence and foresight" and "criminally or tragically foolish actions or conduct".
Some gang members claim that folly is a disrespectful term used against Black P Stone gang members.