Background: Sport has been traditionally characterised for its possibilities for enjoyment and the opportunities that provides for democracy and inclusion. However, there have been many challenges lately given the binary gender categories that people need to participate in. That binary system causes problems for the inclusion of individuals who do not fit in either of those binary categories, like transgender people. Purpose: This study aims to explore the challenges that transgender people face when participating in sport. Methods: A literature review comprising 20 articles has been conducted. The articles included were retrieved from different databases, such as Google Scholar, PsycINFO, Sportdiscus, Semanticscholar, Scopus and Web of Science. Some manual searches were also conducted. Findings: The results show that transgender people face a numerous obstacle when trying to participate in sports. The main findings were classified into four major categories: 1. social aspects, 2. content of activities, 3. locker rooms, body appearance and clothing, and 4. physiological aspects. Conclusion: The findings of this study suggest that the binary gender categorisation in sports is a major obstacle for transgender people to be (and feel) included in sports.