Gender binary sporting divisions should be "abandoned", as it's unfair for transgender women to compete against other women, according to Kiwi researchers.
They say a third division for transgender women and intersex women could be introduced.
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An essay published in the newest edition of the Journal of Medical Ethics considers the International Olympic Committee's (IOC) 2015 decision to allow male-to-female transgender athletes to compete in the women's category at elite sport competitions.
Since its introduction, the guideline has created controversy. There were polarised reactions to New Zealand weightlifter Laurel Hubbard, who is a transgender woman, competing in the 2018 Commonwealth Games in the female category.
The IOC guidelines allow transgender women to compete in the female division "if (amongst other things) their testosterone is held below 10nmol/L", a statement on the essay said.
Professor Alison Heather said that was "significantly higher" than that of cis-women.
"Science demonstrates that high adult levels of testosterone, as well as permanent testosterone effects on male physiology during in utero and early development, provides a performance advantage in sport and that much of this male physiology is not mitigated by the transition to a transwoman," Prof Heather said.
An abstract of the research says: "We conclude that the advantage to transwomen afforded by the IOC guidelines is an intolerable unfairness."
The researchers say they're not arguing transgender women be excluded from sport, but instead competitions should introduce a more nuanced approach.
Potential solutions discussed by the researchers include creating a third division for transgender women and intersex women and calculating a "handicap" for transgender women based on their testosterone levels - similar to that used in golf.
Their preferred option would be an extension of this, introducing an algorithm that took into account certain physical and social variables. They say gender identity and socioeconomic status could be considered.
Associate professor Lynley Anderson, one of the researchers, says it's important to celebrate diversity, but also maintain fairness for cisgender women.
"To be simultaneously inclusive and fair at the elite level some innovative thinking is required, rather than attempting to shoehorn people into either male or female," she said.
"Perhaps the male/female binary should be reconsidered in favour of something more nuanced and useful?
"We conclude that the gender binary in sports has perhaps had its day."
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