Lay Followers and Monastic Practices
In the early sutras of Buddhism, "accepted or unaccepted human sexual conduct" for laypersons "is not specifically mentioned." "Sexual misconduct" is a broad term, subject to interpretation according to followers' social norms. Early Buddhism appears to have placed no special stigma on homosexual relations.
The situation is different for monastics. For them, the Vinaya (code of monastic discipline) bans all sexual activity, but does so in purely physiological terms, making no moral distinctions among the many possible forms of intercourse it lists.
Among Buddhists there is a wide diversity of opinion about homosexuality. Buddhism teaches that sensual enjoyment and desire in general, and sexual pleasure in particular, are hindrances to enlightenment, and inferior to the kinds of pleasure (see, e.g. pīti, a Pāli word often translated as "rapture") that are integral to the practice of jhāna. However, most Buddhists do not pursue skill in meditation or aim for enlightenment. For most, the goal is a pleasant life and, after death, a pleasant rebirth. For these Buddhists, enjoying sensual pleasures in a non-harmful way is normative.
Regarding transsexual people, the earliest texts mention the possibility of a person changing sexes; such a person is not barred from ordination, and if already ordained, simply changes orders.
Read more about this topic: Buddhism And Sexual Orientation
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—Eric Hoffer (19021983)