The paper provides a socio-political context analysis to outline Al-Azhar’s discourse on transgender identities and its influence on law and policy in Egypt. Transgender identities in Egypt represent an issue governed by Islamic Sharia more than anything else. Scholars at Al-Azhar, Egypt’s highest Islamic authority, viewed transgender identities as a danger to the fabric of society if not regulated. Thus, in the 1980s, several Fatwas were issued to examine the compatibility of transgender identities with Sharia. These Fatwas were mostly concerned with the criteria that should exist to allow people to undergo surgical and hormonal interventions to change their sex. Initially, judicial opinions reviewed the issue of transgender identities independently of those Fatwas. However, since late 2000s, judicial opinions shifted to be more aligned with Sharia on the matter. Apart from judicial opinions, the Fatwas that emerged from the 1980s have also managed to influence the official health policy on transgender identities. To understand Al-Azhar’s discourse on transgender identities, the author provides an analysis of three Fatwas issued by three different jurists in the 1980s and 1990s; examines the influence of that discourse on the current health policy providing medical care for transgender people; and provides a socio-political context analysis of judicial opinions in the 1980s and present-day to outline the reasons behind the judicial shift in attitude towards transgender identities.