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Although clinical experience and preliminary research suggest that some transgender people are at significant risk for HIV, this stigmatized group has so far been largely ignored in HIV prevention. As part of the development of HIV prevention education targeting the transgender population, focus groups of selected transgender individuals assessed their HIV risks and prevention needs. Data were gathered in the following four areas: (1) the impact of HIV/AIDS on transgender persons; (2) risk factors; (3) information and services needed; and (4) recruitment strategies. Findings indicated that HIV/AIDS compounds stigmatization related to transgender identity, interferes with sexual experimentation during the transgender 'coming out' process, and may interfere with obtaining sex reassignment. Identified transgender-specific risk factors include: sexual identity conflict, shame and isolation, secrecy, search for affirmation, compulsive sexual behaviour, prostitution, and sharing needles while injecting hormones. Community involvement, peer education and affirmation of transgender identity were stressed as integral components of a successful intervention. Education of health professionals about transgender identity and sexuality and support groups for transgender people with HIV/AIDS are urgently needed.