Prime Minister Scott Morrison endorsed Tasmanian senator Claire Chandler's bill this week, after Chandler introduced her private members bill to the senate seeking to amend sexual discrimination laws in sport.

Chandler argued cisgender women must be saved due to the "numerous physical advantages" men have on the sporting field, and women's single-sex sport should be able to exist without legal action.

Mouncey knows Chandler's argument well after her own fight to play in the AFLW. She was banned from entering the draft and had considered legal action against the AFL and its gender diversity policy.

Australian sport has been grappling with the need for transgender policies in recent years, prompted by Mouncey's situation.

Eight sports issued transgender guidelines two years ago to encourage participation, following consultation with Sport Australia and the Human Rights Commission.

But Morrison's support of the proposed bill has sparked debate, and Mouncey is concerned for the welfare of transgender athletes.

Transgender people above 18 are nearly 11 times more likely to attempt suicide in Australia.

"Any other group in the community who was reporting figures like that, we'd be doing whatever we could to help them. Instead, people then say, 'Well see trans, people are just mentally ill', but it's not the case," Mouncey said.

"It's not that trans people are more predisposed to mental health issues than anyone else. The reason that those numbers are like that is entirely down to the way they're treated.

"Honestly, just this discussion being out there in the media and trans people being talked about the way they are, it'll kill people. And not in five years time or 10 years time, it'll kill people now."

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Transgender athletes continue to encounter roadblocks on the sporting field, with the latest being American college student Lia Thomas, who is likely to miss the NCAA swimming championships due to a new policy.

The USA Swimming policy outlines 36 months of testosterone suppressants, and goes against the International Olympic Committee's 2015 guidelines of 10 nanomoles of testosterone per litre of blood for athletes to compete at the elite level.

Morrison's support of Chandler has sparked debate, with advocates questioning whether the bill was needed and Mouncey declaring she would continue fighting for trans-athlete rights.

"When the IAAF was trying to get Caster Semenya to suppress her testosterone, it was because they were adamant that the research showed that testosterone suppression reduced performance so significantly that it would create a level playing field," she said.

"Yet when that same research, data and the exact same medications happened but are applied to trans women, those same people say that it doesn't stack up. So they need to choose which side of it they're on.

"There is yet to be a case of anyone who's been playing third grade cricket or football and then on to play internationally, so the whole thing is just a joke.

"Laurel Hubbard was setting New Zealand records competing with men. Me, for example, I was already competing at World Championships and Olympic qualification events with the men's handball team. Lia Thomas in America, same thing, she was already swimming at the same level but with the men prior to transition."

Despite the backlash, Senator Chandler is standing by the bill and said she was yet to hear anyone attempt to mount an argument that women should not have the right to play single-sex sport.

"The facts are that Australia's peak sporting body has advised sports clubs that they can face legal action if they don't admit males into female sport," she wrote in a media release.

"Female sportswomen have already missed out on becoming Olympians because males were allowed into female sport."