The New South Wales Court of Appeal ruled that people do not have to be officially registered as male or female, after Sydney activist ‘Norrie’ (below) contested this law. The judges panel ruled “as a matter of construction … the word sex does not bear a binary meaning of ‘male’ or ‘female.’” This means that transgender, intersex and other queer-identified Australians are no longer forced to fit themselves into a narrow gender binary.
“This is the first decision that recognises that ‘sex’ is not binary – it is not only ‘male’ or ‘female’ – and that we should have recognition of that in the law and in our legal documents. This sets a precedent. In future, government departments and courts may adopt the reasoning found here.”
– Emily Christie, Norrie’s solicitor from DLA Piper

Update 2014
This New South Wales decision was subsequently appealed and it went to the High Court. On the 2nd of April 2014 the High Court ruled that New South Wales law can indeed recognise non-specific genders other than male or female.
See the legal document below, High Court ruling: NSW Registrar of Births, Deaths and Marriages v Norrie