A Government select committee has recommended changes to the process for amending gender on a person's birth certificate.
The move would allow people to change the gender on a birth certificate by signed signatory declaration, rather than the current system that involves a Family Court.
It has also been recommended that a third, non-binary marker be added alongside male and female.
Sharon Forsyth from organisation NZ Parents and Caregivers of Transgender and Gender Diverse Children says the current process is a barrier to some families changing the certificate.
"Currently, changing a gender marker for a young person under the age of 18 requires an intrusive process overseen by the Family Court. The court is required to specify medical treatment for the young person.
"The process is costly and intimidating for families and presents a barrier to doing what current psychological best practice tells us to do for our transgender young ones supporting them to live normal lives."
The Human Rights Commission (HRC) has praised the recommendations and says they will bring New Zealand in line with international human rights law.
"A person's gender identity is one of the most intimate areas of a person's private life," says Taine Polkinghorne, the HRC advisor for sexual orientation, gender identity and sex characteristics.
"The right to self-identification and recognition before the law is not a special right; it is a human right."
Gender Minorities Aotearoa says the changes will make the process of updating a person's gender on their birth certificate fairer.
"This makes a huge difference to takatāpui, trans and non-binary people when they get married, have children, sign their parent's death certificate or have to show their birth certificate," said spokesperson Sally Dellow.
"It has no impact on the equivalent rights for other people."