The Deputy Ombudsman is hoping the Corrections Department will review its policy for transgender prisoners.
The issue has arisen again as a Whangarei District Court judge considers how to sentence a transgender woman who faces a jail term.
The Ombudsman's report in February said transgender prisoners are at risk if placed in prisons according to their sex status at birth.
Deputy Ombudsman Leo Donelly said the department changed its stance last month and agreed to take up the directions from the report to review its policy.
"The Ombudsman view is that current policy is unreasonable and basically risks putting transgender prisoners at risk."
Mr Donnelly expects an outcome by the end of the year. The Corrections Department is making no comment.