The British Triathlon Federation confirmed that for athletes over the age of 12, competitive women's events will be reserved "for those who are female sex at birth".
The policy, which will begin from January, will see an 'open' category "for all individuals including male, [male and female] transgender and those non-binary who were male sex at birth."
It will apply to all events where there are prizes, times or rankings at stake, including at the grassroots level of the sport.
Triathlon is an increasingly popular multi-disciplinary participation sport in the UK comprising running, swimming and cycling.
"Where this is competitive activity, fairness is paramount," said Andy Salmon, chief executive of British Triathlon. "Our sport is gender-affected.
"We believe this is the right policy for triathlon in Great Britain, and the right time to publish it. We have taken legal advice and are confident it's legally robust."
British Triathlon said the new approach followed a survey of more than 3,000 members that found 80% were in support of the two categories.
The new policy replaces the existing guidelines set in 2018, which allow trans women to compete against female athletes if they have suppressed their testosterone.
Salmon said he was "not aware" of any elite-level transgender triathletes in Britain - but he added: "We didn't want to be a governing body that waited for that to be a problem before we tried to fix it.
"We don't know what's going to happen tomorrow or the next day, and we wanted to be ready for that day."
Reasonable approach? I believe so.
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Oda break tracker 2022- 3 (2) | THE Ohio State: 12-2 | Las Vegas Raiders: 10-8