A person described as transgendered or transsexual usually identifies as, and desires to live and be accepted as, a member of the sex opposite to that indicated by their body. Thus some individuals have a strong feeling that they are female despite having male genitals or that they are a man despite having a woman’s genitals. Such people often say that they feel they are ‘in the wrong body’. Ancient Indian literature contains numerous myths about people who spontaneously changed sex, usually as a result of having desire or sometimes even just admiration, for someone of the same sex. Several such stories are also found in Buddhist sources. The commentary to the Dhammapada (5th century CE ?) includes a story about a man named Soreyya who changed into a woman after becoming entranced by a particular monk’s beautiful complexion. Later he married and bore two children (Dhp. A. I,324). The ancient Indians seem to have seen considered gender to be a rather fluid thing. This subject is well covered in Ruth Vanita and Saleem Kidwai’s in-depth and well-informed Same Sex Love in India – Readings from Literature and History. The Tipitaka mentions several different types of transgendered states and individuals – the man-like woman (vepurisika), sexual indistinctness (sambhinna), one having the characteristics of both genders (ubhatovyanjanaka), etc (Vin.III,129). The interesting thing is that such states and individuals are taken for granted in the scriptures with little or no moral judgments being attached to them.
Various theories have been posited to explain transgenderism – that it is a psychological or hormonal abrogation or that it has genetic or environmental causes. The Buddhist doctrine of rebirth could help explain why some people are transgendered. A person may be reborn as, say, a woman in numerous successively lives during which time feminine attitudes, desires, traits and dispositions become strongly imprinted on their mind. This would determine that they were continually reborn into a female body or that their consciousness would mold the embryo into a female form - whatever factors are responsible for the physical characteristic of gender. Then, for either kammic, genetic or other reasons they may get reborn into a male body while psychologically remaining 'female' . If this or something like it, is the cause of transgenderism, it would mean that this condition is a natural one rather than a moral perversion as most theistic religions maintain.
Transgenderism has presumably existed in all Buddhist societies as it does everywhere else, although I have never even heard of it in Sri Lanka during my 20 years there. However, transgendered people seem be particularly visible and common in Thailand. The Thai word kathoey is used loosely for effeminate homosexuals, transvestites but particularly for transgendered people. Although such people are largely accepted in Thailand, probably because of the tolerance encouraged by Buddhism, they still face numerous social and legal difficulties and often end up as prostitutes. A jurisdiction in which the Dhamma was genuinely applied would recognize transgendered peoples’ specific needs and allow them to legally change their gender if and when they undergo gender reassignment surgery.