With more cows and sheep than people, Shepparton is probably the last place you'd think of as being a haven for transgender youth.

But the small Victorian town has a thriving group of young gender-diverse people who are changing the stereotypes and helping to build a supportive community.

Transgender 16-year-old, Alex Sinclair, says he has received nothing but support in Shepparton.

"There's lots of people who have a stigma around small towns saying they're really unaccepting, when they're not really at all," said Oscar Riddell, an 18-year-old who is transitioning from female to male.

"Everyone's really nice to each other. And I think it's because of how close everyone gets."

His friend Alex Sinclair agrees. Since doing a story in the local paper about being transgender, Alex, 16, said he has had nothing but support.

"I thought I was going to get a bit of negativity, but I didn't."

Alex's parents Lyle and Dana Sinclair, an ambulance technician and nurse, said they too felt supported.

"Our friends and family and in particular Alex's school have been really helpful," Dana said.

"I was surprised by the amount of people that actually came up and said, 'Hey this is great, well done'," Lyle said.

'Everyone knows me as just another guy'

Alex and Oscar are members of Diversity, a support group for gender-diverse youth, run by Kildonan Uniting Care.

Alex's parents Lyle and Dana Sinclair said the entire family feels supported.

Every fortnight around 15 people aged between 14 and 25 gather in a nondescript meeting room next to a church in Shepparton to share a meal and experiences.

Over the last couple of years Diversity's community development worker Damien Stevens has seen the group change from being predominantly used by gay and lesbian youth, to transgender.

"We've really seen the number of gender diverse and trans young people — I don't know whether I should say increase or simply be more visible and certainly feel more welcome," he said surveying a room of young people laughing and chatting.

The peer support has been crucial to the young people accepting and growing into their real identities.

"I feel like this is my second home," said Anakie, a young man who was kicked out of home when he told his family he was a boy, and not the girl whose body he was born into.

"In here everyone knows me as just another guy and I go out into the world and I'm no longer just another guy, I'm 'the trans kid' or 'the gay kid' or 'the high school dropout'.

"Here I'm just me."

Oscar said he believes every town has the same proportion of transgender youth, but Shepparton's are more visible because of the support they receive.

"There's a lot of people here [at Diversity meetings] for such a small town," he said.

"Part of it is how accepting Shepparton is, that people are actually feeling comfortable to come out."

Alex, Jordyn and Anakie attend a Diversity meeting where they say they feel welcome.

'We try to celebrate and support them'

For the past four years the city of 45,000 people has hosted the Out in the Open festival, a celebration of LGBTI people.

"Well I think we're very lucky to be living in greater Shepparton because it is quite a progressive small city," deputy mayor Fern Summer said.

"We do have a strong LGBTI network, and they're predominantly the youth, and we try to celebrate and support them as much as possible, like we do all diversity across the municipality."

Five of Greater Shepparton's seven high schools are part of the Same Schools Coalition, which was the centre of controversy earlier this year over some elements of it anti-bullying curriculum.

Damien Stevens of Kildonan Uniting Care believes the city has grown into its embrace of diversity after decades of concerted activism by social workers and the gay community.

But he also strikes a note of caution.

"Greater Shepparton has a really good culture of accepting diversity," he said.

"I purposely use the word accepting because it's probably one step up from tolerating, but one step below supporting.

"There is still some way to go."