Berkeley, California (CNN) One of the first things Thomas Lobel told his parents was that they were wrong.

The 3-year-old had learned sign language because he had apraxia, a speech impediment that hindered his ability to talk. The toddler pointed to himself and signed, "I am a girl."

"Oh look, he's confused," his parents said. Maybe he mixed up the signs for boy and girl. So they signed back. "No, no. Thomas is a boy."

But the toddler shook his head. "I am a girl," he signed back emphatically.

Regardless of the fact he was physically male, Thomas has always maintained that he is a girl. When teased at school about being quiet and liking dolls, Thomas would repeat his simple response, "I am a girl."

Thomas, now 11, goes by the name of Tammy, wears dresses to school and lives as a girl.

Her parents have been accused by family, friends and others of being reckless, causing their youngest child permanent damage by allowing her to live as a girl.

When children insist that their gender doesn't match their body, it can trigger a confusing, painful odyssey for the family. And most of the time, these families face isolating experiences trying to decide what is best for their kids, especially because transgender issues are viewed as mysterious, and loaded with stigma and judgment.

Transgender children experience a disconnect between their sex, which is anatomy, and their gender, which includes behaviors, roles and activities. In Thomas' case, he has a male body, but he prefers female things likes skirts and dolls, rather than pants and trucks.

Gender identity often gets confused with sexual orientation. The difference is "gender identity is who you are and sexual orientation is who you want to have sex with," said Dr. Johanna Olson, professor of clinical pediatrics at University of Southern California, who treats transgender children.

When talking about young kids around age 3, they're probably not interested in sexual orientation, she said. But experts say some children look like they will be transgender in early childhood, and turn out gay, lesbian or bisexual.

There is little consistent advice for parents, because robust data and studies about transgender children are rare. The rates of people who are transgender vary from 1 in 30,000 to 1 in 1,000, depending on various international studies.

Like Tammy, some children as young as 3, show early signs of gender dysphoria or gender identity disorder, mental health experts who work with transgender children estimate. These children are not intersex -- they do no have a physical disorder or malformation of their sexual organs. The gender issue exists in the brain, though whether it's psychological or physiological is debated by experts.

One of the most recognizable transgender celebrities is Chaz Bono, who currently competes on "Dancing with the Stars." Born female to entertainers Sonny and Cher, Bono underwent a transition to become a man in his 40s. He wrote in his book "Transition" that even in his childhood, he had been "aware of a part of me that did not fit."

Many transgender kids report feeling discomfort with their gender as early as they can remember.

Mario, a 14-year-old Californian who asked his full name not be used, was born female. He dresses and acts like a boy, because, he said, since he was 2 years old, he never genuinely felt like a girl.

"I feel uncomfortable in female clothes," said Mario. "I feel like why should I wear this when it's not who I am? Why should I be this fake person?"

But when a child starts identifying with the opposite gender, there is no way to determine whether it's temporary or likely to become permanent.

"It's important to acknowledge the signs of gender dysphoria, especially for children," said Eli Coleman, who chaired a committee to update treatment guidelines for the World Professional Association for Transgender Health, an international medical group meeting this week in Atlanta, Georgia. "By not addressing it, it could be really more damaging for the child than not."

"It's a very difficult area and there are a lot of children who have gender nonconformity. They will simply grow out of that. Many of them later on identify as gay or lesbian, rather than transgender."

The American Psychological Association warns that "It is not helpful to force the child to act in a more gender-conforming way." When they're forced to conform, some children spiral into depression, behavioral problems and even suicidal thoughts.

Do kids know who they are?

Thomas Lobel's metamorphosis can be told in pictures.

After his parents, Pauline Moreno and Debra Lobel, adopted Thomas at age 2, they observed that he was aloof. Shy and freckle-faced, he usually sat in a corner reading a book.

Unlike his two older brothers who were boisterous, athletic and masculine, Thomas was unusually quiet. Because of his speech impediment, he had to go to special education. Despite developing better speech skills, he didn't want to engage in conversation or socialize.

"He seemed so depressed and unhappy all the time," Lobel said. "He didn't enjoy playing. He sat there all the time, not interacting with anybody. He seemed really lonely."

In photos, Thomas appears small with a clenched smile and a glazed and distant look in his eyes.

Throughout his childhood, Thomas wanted to read Wonder Woman comics rather than Superman, wear rhinestone-studded hairbands instead of baseball caps and play with dolls rather than action figures. And, his parents said, he kept insisting he was a girl.

His situation worsened when Thomas told his parents he wanted to cut off his penis. His parents tried to rationalize with him, warning him that he could bleed to death. But his request was a signal to them that this was serious and required professional help.

After seeing therapists and psychiatrists, the mental health specialists confirmed what Thomas had been saying all along. At age 7, he had gender identity disorder.

The diagnosis was hard for Moreno and Lobel to accept.

"The fact that she's transgender gives her a harder road ahead, an absolute harder road," Moreno said.

They have been accused of terrible parenting by friends, family and others, that "we're pushing her to do this. I'm a lesbian. My partner is a lesbian. That suddenly falls into the fold: 'Oh, you want her to be part of the lifestyle you guys live,' " Moreno said.

But that couldn't be further from the truth, they said. People don't understand how a hurting child can break a parent's heart.

"No parent wants to be in this situation," said Lisa Kenney, managing director of Gender Spectrum, a conference for families of gender nonconforming children. "Nobody had a child and imagined this was what would happen."

Transgender kids do not come from lax parenting where adults "roll over" to their kids' whims, said Olson, who treats transgender children.

"The parents are tortured by it," she said. "These are not easy decisions. Parents go through a long process going through this."

Moreno and Lobel allowed their child pick his own clothes at age 8. Thomas chose girl's clothing and also picked four bras. Then, Thomas wanted to change his name to Tammy and use a female pronoun. This is called social transitioning and can include new hairstyles, wardrobe. Aside from mental health therapy, this stage involves no medical interventions. Social transitioning is completely reversible, said Olson, a gender identity specialist.

Every step of the way, her parents told Tammy, "If at any time you want to go back to your boy's clothes, you can go back to Thomas. It's OK." Tammy has declined every time.

She continues to see therapists.

Tammy's room is painted bright golden yellow, decorated with stuffed animals and cluttered with pink glittery tennis shoes. At home, Tammy dances through the hallway, twirling in her pink flower dress.

"As soon as we let him put on a dress, his personality changed from a very sad kid who sat still, didn't do much of anything to a very happy little girl who was thrilled to be alive," Moreno said.

The hormone question

This summer, Tammy began the next phase of transition, taking hormone-blocking drugs. This controversial medical treatment prevents children from experiencing puberty.

Girls who feel more like boys take hormone-suppressing medications so they will not develop breasts and start menstruating. Boys who identify as girls can take blockers to avoid developing broad shoulders, deep voice and facial hair. The drugs put their puberty on pause, so they can figure out whether to transition genders.

The hormone blockers are also reversible, because once a child stops taking the drugs, the natural puberty begins, said Dr. Stephen Rosenthal, pediatric endocrinologist at UC San Francisco.

But if the child wants to transition to the other gender, he or she can take testosterone or estrogen hormone treatment to go through the puberty of the opposite gender.

This transgender hormone therapy for children is relatively new in the United States after a gender clinic opened in Boston in 2007. Programs for transgender children exist in cities including Los Angeles, Seattle and San Francisco. The kids are treated by pediatric endocrinologists after long evaluations by mental health professionals.

No statistics exist on the number of transgender children taking such medical treatments.

Medical practitioners have to be careful with children with gender identity issues, said Dr. Kenneth Zucker, head of the Gender Identity Service in the Child, Youth, and Family Program and professor at the University of Toronto. Giving children hormone blockers to kids before the age of 13 is too early, he said.

Zucker conducted a study following 109 boys who had gender identity disorder between the ages of 3 and 12. Researchers followed up at the mean age of 20 and found 12% of these boys continued to want to change genders.

"The vast majority of children lose their desire to be of the other gender later," he said. "So what that means is that one should be very cautious in assuming say that a 6-year-old who has strong desire to be of the other gender will feel that way 10 years later."

All of this leads to unsettling answers for families trying to understand their children. No one knows whether a child's gender dysphoria will continue forever or if it is temporary.

The unsatisfying answer repeated by experts is that only time will tell.

Despite the murky science and social stigma that confound adults, Mario, who has lived as a boy since fourth grade, has a simple answer.

"Don't change for nobody else," he said. "Just be you and be happy."