Without drag, Monica Beverly Hillz might not be alive today.

“I lived a whole other life that women like me do not really survive. Drag really saved me,” the Chicago-based performer said in a recent interview.

Hillz made headlines in 2013 when she came out as a transgender woman while competing on RuPaul’s Drag Race, the hit reality show that brought drag queens to audiences across the globe. She was the first to come out as a trans woman during the competition, and the show largely embraced her.

But this week, RuPaul sent a different message. He told the Guardian he would “probably not” let a trans woman on the program, adding: “You can identify as a woman and say you’re transitioning, but it changes once you start changing your body.” His remarks sparked an uproar from drag queens, trans performers and LGBT rights activists who were particularly upset that RuPaul spouted the harmful notion that physical characteristics determine gender identity.

Monica Beverly Hillz. Photograph: Kater Tot Photography / Design by Odd Fox Inc

RuPaul eventually backtracked, but the controversy has reignited debates about the boundaries of drag and the role of the art form in an era when trans people are increasingly visible and gender is more widely seen as fluid.

“RuPaul himself would not have the career he has and the platform he has if it wasn’t for the trans women who came before us,” said Pearl Teese, a San Francisco drag performer who is also a trans woman. She added: “Drag is just a form of self-expression.”

RuPaul’s Emmy-winning show, which has a large mainstream audience, has consistently featured men performing in drag as women, completing runway challenges and lip-sync battles.

Drag can be more risky, creative and entertaining when it’s not limited to men, said Hollow Eve, a San Francisco performer who identifies as a “post-binary” drag artist and uses gender-neutral “they” pronouns: “The subversive, wild, politically interesting thought-provoking art that is happening in San Francisco and in so many cities across the country … that’s what I want to watch.”

Drag scenes can be more inclusive by also giving the stage to “drag kings” (often women dressing as men), non-binary people and women (trans and cisgender), they added.

“We have queens with beards, queens who tuck, queens who don’t tuck, queens who add padding, queens who don’t add padding,” said Dottie Lux, a San Francisco performance artist who produces diverse drag and burlesque shows. The RuPaul restrictions “boil down to body parts, and for me that is so unnecessary”, she said. “Why must you know what my genitals look like at this moment?”

Pearl Teese. Photograph: Gareth Gooch

A growing number of young people identify as trans and nonconforming, but some lamented that drag and RuPaul’s show was not keeping pace.

Sara Andrews, a Chicago drag performer and trans woman, said that while tipsy one night, she emailed Drag Race casting, asking if the show would be allowing trans entertainers and got a one-word reply: “YES!”

She and other trans women subsequently sent in audition tapes, she said, but none were selected.

“There are so many talented beautiful trans queens … who are not getting the same opportunities,” she said, adding that drag in the south, where she started her career, has long been inclusive and helped her come out as trans.

Andrews recently launched a wig business and noted that numerous trans women design the hair and outfits that queens use on Drag Race: “Our drag is actually good enough to be on the show, but not with us wearing it.”

Bionka Simone Gemini, a San Francisco performer, said she started doing drag before she came out as a trans woman, but that her passion for the art form hasn’t changed: “At the end of the day, we’re entertainers … It’s a way for me to escape a little bit, to have fun and actually express my creative side.”

Bionka Simone Gemini. Photograph: Courtesy Bionka Simone Gemini

Honey Mahogany, a San Francisco performer and former Drag Race contestant, noted that trans women could feel unwelcome in spaces that are traditionally dominated by gay men.

Drag, she added, should break down the binary, not reinforce it. “If drag is supposed to be a revolutionary act, and RuPaul is saying it becomes less revolutionary when she’s a trans woman, that really calls into question the entire system.”

Hillz sometimes receives death threats and hate mail when she advocates for trans inclusion in drag, but she said she won’t stop speaking out.

“People are off-put by something they don’t understand,” she said. “People are a little bit nervous with somebody who is 100% OK with themselves and fulfills their dreams.”