At 14, he entered the Miss Teen Hawaii USA contest and became a finalist. "I remember feeling uncomfortable on stage," he said.
Eventually Thomas Beatie traded modeling and pageants for karate and the gym and began to dress like a man and use the men's bathroom. Although he had several boyfriends, he now says he hated sex.
At 24, Thomas Beatie began a lesbian relationship with Nancy, a bodybuilder, and moved in with her and her two daughters from a previous marriage.
In 1998, Thomas Beatie decided to change genders. Psychological testing confirmed that he identified with being a male and he began to medically transform his body, first, by injecting the male hormone testosterone.
"My voice started to change," he said. "It started to crack like I was going through puberty. My bones felt stronger, my ligaments felt stronger. I started to grow facial hair."
In 2002, Thomas Beatie, still legally Tracy, had sex reassignment surgery to remove his breasts. "That day was -- the most liberating day of my life. I literally felt like a weight was lifted from my chest."
To legally change genders is a long and complicated process. No federal law applies and state requirements vary. In Hawaii, with a letter from a doctor certifying Thomas Beatie's psychological testing and irreversible surgery, he was legally allowed to change his birth certificate from female to male and his name from Tracy to Thomas.
Though Thomas Beatie physically and legally transformed himself from a woman to a man, he did not have "bottom" surgery, known as phalloplasty, to create an artificial penis. He also left his female reproductive organs in place.
"I don't feel like removing your sexual reproductive organs will make you any more of a man or any less of a woman," he said.
Last year on "20/20," Walters reported on how children as young as 5 years old are transitioning from one gender to another. And in the last few years transgender people have gained gradual acceptance, even showing up in Hollywood plot lines, such as on the TV series "Ugly Betty" and "Dirty Sexy Money." But what happens when that transgender child grows up and wants to have a baby?
In 2003, Thomas and Nancy Beatie were legally married, and like many couples, they decided to start a family. The couple wanted to have a biological link to their child, but Nancy Beatie had a hysterectomy. The couple did not want to hire a surrogate to carry Thomas Beatie's harvested eggs, feeling no surrogate could be as conscientious as he.
So how does a man who was once a woman get pregnant? The first step was to stop taking testosterone, his male hormone. After four months he began menstruating.
The Beaties then needed a doctor who could help them obtain donor sperm and inseminate it into Thomas Beatie, but nine doctors rejected them.
In the end, the Beaties did it all themselves. First, they bought donor sperm on the Internet and Nancy Beatie used a syringe she had bought at a pet store to inseminate her husband. Soon after, a home pregnancy test confirmed that he was pregnant.