Last year, defense officials estimated there were about 200 transgender individuals in the USA military who had self-reported to their services a desire for some form of medical treatment related to their gender identity.
However, a number of federal judges have already issued rulings blocking Trump's ban, saying it would probably violate the right, under the US Constitution, to equal protection under the law.
The decision will be reviewed at the Pentagon followed by the Justice Department will also have to make the case in federal court.
"The president's hateful ban is purpose-built to humiliate our fearless transgender members of the military who serve with honor and dignity".
According to Defense Department memorandum, the new policy will allow some transgender members to serve while barring any who have been diagnosed with gender dysphoria or undergone a gender transition and are willing to serve in their biological sex.
"Donald Trump and Mike Pence are literally wreaking havoc on the lives of our military families", said Ashley Broadway-Mack, president of the American Military Partner Association.
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"The Trump-Pence Administration continues to double down on its cruel and unconstitutional ban on transgender troops", said Human Rights Commission National Press Secretary Sarah McBride in a statement. That principle could affect transgender troops who require medical care that could not be provided in a war zone. He accused the Obama administration of allowing transgender military service without identifying a "sufficient basis" that doing so would not "hinder military effectiveness and lethality, disrupt unit cohesion, or tax military resources", and he directed Mattis to have the Pentagon adopt a new ban similar to the military's former policy by Friday.
Mattis announced shortly after receiving the memo that transgender troops could continue serving while the Pentagon studied the issue. "It's a gross mischaracterization of transgender people, and it's bad for our. military".
While the exact number of transgender individuals in active duty service is unknown, a 2016 Rand Corporation study commissioned by the Pentagon estimated the number to be anywhere from 1,320 and 6,630, with 830 to 4,160 others serving in the reserves.
"California will take every measure available to prevent (Trump's) discriminatory action that harms or marginalizes transgender service members - or any other transgender Americans who wish to courageously defend our nation", Becerra tweeted.
In August, Trump sent Defense Secretary Jim Mattis a memo ordering him to propose changes to the Obama-era policy that allows transgender troops to serve openly and receive medical treatment, including sexual reassignment surgery.
In February, the Pentagon confirmed that one transgender recruit had joined a branch of the military after the ban was lifted due to the court order.
He disputed the argument that accommodating transgender men and women in uniform is too much of a burden.
The policy for transgender troops was established in 2016 by then-Defense Secretary Ash Carter.
"We went through that with 'Don't Ask, Don't Tell, '" he said of the decision in 2011 to allow gays to serve openly.
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