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State institutions around the world have dedicated disproportionate effort to regulate transgender individuals through laws concerning gender-affirming care and gender reclassification. Using the case of China’s first and only policy on gender-affirming surgery, this paper historicizes and illustrates the process by which “transgender” becomes a recognized category for state surveillance and governance. By tracing what I call a “biopolitical gender regime”—policies and practices that medicalize and bureaucratize gender reclassifications—I investigate the way state institutions regulate how medical institutions modify sexed/gendered bodies and define how these bodies link to the legal categories of “male” and “female.” Drawing data from state newspapers, medical literature, and biographies from transgender authors between 1950 and 2010, I found that this biopolitical gender regime arose from a “dual movement” in which medical experts and policymakers collaborate to define state policies on gender reclassification. In doing so, they integrated two “hands” of state gender governance: a disciplinary hand, originating during the Maoist era (1950s), which used gender to sort and surveil citizens while assessing their risk levels for social governance; and an enabling hand that optimizes gendered bodies to maximize individual productivity during the post-socialist reform period (1980-2000). In 2009, these two hands of state gender governance were unified into state policies detailing the criteria for surgeries warranting gender reclassification. These findings contribute to the sociology of the state and science studies by demonstrating how scientific processes work in tandem with policymaking to define new categories of personhood.