Oct. 7, 2011 -- It's literally dangerous to be young and coming out of the closet. In February 2008 15-year-old Larry King, of Oxnard, Calif., was killed by his classmate, Brandon McInerney, because King was exploring his sexuality.

More and more gay teenagers are committing suicide because they were bullied for it.

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Last month, 14-year-old Jamey Rodemeyer took his own life after being bullied at school for being gay. "People would be like, 'faggot, fag,' and they'd taunt me in the hallway," Jamey said in a YouTube video in which he spoke his heart and even reassured others that "it does get better." His death has sparked a national debate about how to stop bullying in schools. Jamey's idol, Lady Gaga, even asked President Obama to make bullying a hate crime. But is passing a law really the answer?

One all-American city may have already come up with a unique solution. Milwaukee is home to the first public middle school where coming out of the closet is accepted, even if you're in the sixth grade.

Fourteen-year-old Emiliano Luna was one of The Alliance School's youngest openly gay students. "You can truly be yourself here, without having to worry about being picked on or threatened or beat up," he said.

Nicole Lopez, another student here, said she knew she was attracted to girls when she was just 11. "I didn't really call myself gay, but told my sisters that I liked girls," she said, adding that it was still hard, "because I'm still a teenager." But that changed for Nicole when she came to The Alliance School, where tolerance is the first lesson taught.

Respect and risk-taking are other key lessons in a class at the school known as Life Skills. Fifteen-year-old Robbie said he took a big risk coming out to his parents so young. "They respect it. They don't get it, but they respect it," he said, adding that it was a risk worth taking.

Alicia Moore, a teacher at Alliance, said Robbie found a safe haven there: "Robbie, early on in the school year, came to school with a black eye. I said, Robbie, what happened? He said, 'not everyone is as nice as they are here.'"

The school has made efforts to make every student feel comfortable inside and outside of the classroom. "This is the unisex middle school bathroom," said 16-year-old Becca Dybao, while proudly giving us a tour of her school. "We do this so students can feel if they want to be a tranny, they can be a female." A bathroom for kids who are transgendered might be seen as controversial, but students and parents feel that it's a life-saver for kids who are bullied every day.

Becca, who identifies as bisexual, is not afraid to express herself freely. At the sight of her girlfriend, Frost, she ran excitedly down the hallway to embrace her. Her actions, according to lead teacher Tina Owen, might lead to suspension in other schools. "I worked at a large public high school," she said, "and there were students who were getting suspended for things like holding hands and running down the hall." At Alliance, it's not unusual to see a girl kiss another girl or watch a boy putting on make-up in class. "That's not an issue, because it doesn't affect their education," added Owen.

Alliance School Stays Open Despite Criticism

According to Eliza Byard, Executive Director of the Gay Lesbian Straight Education Network (GLSEN), schools like Alliance are only a Band-Aid solution to a tremendously urgent problem, but tackling the problem in any way does make a difference. "What we have seen is, when you take on the issue of anti-LGBT harassment and bullying, you see better results for students," said Byard. To critics who argue that schools like Alliance are indoctrinating students with the gay agenda, Eliza responded, "This is about letting students go to school and be safe."

But Finn Laursen, Executive Director at Christian Educators Association International, said he did not want schools telling students that homosexuality was acceptable. "It isn't the school's job to try to teach children that 'this lifestyle is good, that lifestyle is better,'" he said.

The controversy is nothing new to The Alliance School. It has had its share of critics and setbacks. When the school faced the possibility of losing its charter, lead teacher Owen said the school was "life or death for some of these kids." Students from the school pleaded in front of their local school board to keep Alliance open. "If you take away this school from us, you're not taking away a school. You're taking away a home," said Emiliano.

The board agreed to keep the school open for at least three more years amid cheers and applause from students and teachers. It's a victory for kids like Emiliano, who, like Jamie Rodemeyer, adores Lady Gaga. His bedroom is plastered with her pictures.

Emiliano says gone are the days of dreading going to school. "I was always known at my old school as the kid that laughed at everything. People always make fun of me for that. I would laugh so much. But here people just laugh with me, not at me," he said.

Jamey Rodemeyer might well have thrived at The Alliance School. On Sept. 24 he was buried wearing a t-shirt saying "I was born this way."

Watch "20/20" tonight at 10 p.m. ET.