Transsexuals will be able to compete at the Olympics if they have had appropriate surgery and are legally recognised as members of their new sex, the International Olympic Committee said on Monday.
The rule will cover both male-to-female and female-to-male cases and will be in place before the Athens Games in August.
The International Olympic Committee's (IOC) medical commission drew up a list of criteria and said transsexual athletes could compete, providing:
"Surgical anatomical changes have been completed, including external genitalia changes and gonadectomy.
"Legal recognition of their assigned sex has been conferred by the appropriate official authorities.
"Hormonal therapy appropriate for the assigned sex has been administered in a verifiable manner and for a sufficient length of time to minimise gender-related advantages in sport competition."
Hormone treatment must have ceased at least two years before competition, IOC spokeswoman Giselle Davies said.
"This has been something of an open door," added IOC medical director Patrick Schamasch. "We needed some rules and regulations in place."
Some people contend that transsexual athletes have a physical advantage against other women.
Men have higher levels of testosterone and greater muscle-to-fat ratio and heart and lung capacity.
However, doctors say, testosterone levels and muscle mass drop after hormone therapy and sex-change surgery.
Until 1999, the IOC conducted gender verification tests at the Olympics but the controversial screenings were dropped before the 2000 Sydney Games.
One reason for the change was that not all women have standard female chromosomes.