At the moment of conception, the human fetus becomes a male or a female based on the presence of a "Y" chromosome in a male and the absence of a "Y" chromosome in a female. The gonads are identified by the chromosome make up: an "XX" person is a female who has ovaries, and "XY" person is a male who has testes.
These organs remain quiet at the very-very beginning and under the influence of the mother's placental hormones called gonadotropins, they cross over the placenta, and stimulate the gonad to perform miracles during the first 12 weeks of gestation. Females gonads remain quiet, male gonads begin producing testosterone. Testosterone is recognized in the cells of the body and cause changes in the anatomy. As the baby develops the female organs disappear and male organs appear. Normal male anatomy is recognizable as early as 3 month before birth. At birth the baby is RECOGNIZED, not assigned, as male or female. It is extremely rare to have DSD's and they are not associated with gender disturbance in real-life.
The term, "transsexual" was replaced by the, "transgender" movement. Gender Identity Disorder was coined by Kenneth Zucker, PhD. It was in the DSM until DSM-IV as a psychiatric disorder. Zucker acknowledged said people in need of care and the term changed to Gender dysphoria in DSM-IV.
The transgender movement of today has its roots in the work of 3 different people. These three got together, with their conjoined interest over human sexuality, to remove all boundaries to what would be acceptable human behavior. Alfred Kinsey, an entomologist with no training in human sexual behavior, Harry Benjamin, a family practitioner with no training in mental health or counseling, and John Money, a PhD Psychologist.
Their work was the start of the sexual revolution in the USA from 1950 to 1970. They challenged what was normal and abnormal in sexual behavior. Kinsey, today would be a pedophile and throw in jail for what he did to children with no ethical guidelines. Benjamin treated Christine Jorgensen. John Money, a professor at Johns Hopkins, called himself an endocrinologist but no such training, just experience. "I have an idea," is what he was famous for saying. He wanted to see patients with DSD's (under-virilized males, or over-virilized females). These cases are extremely rare and not associated with gender disturbance in real-life.