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1.
A self-identified lesbian or dyke who happens to have been born with the birth defect of a wholly or semi-operative penis.

This term can sometimes be applied to such a person after said birth defect has been altered by means of corrective surgery, but is more appropriate before such repairs have been undertaken.
As 'John', she was able to pass as a straight man, but now, as 'Joanne', she's an out transdyke.
by Honor March 14, 2005
 
2.
Pretty much all straight males describe themselves as a "lesbian trapped in a man's body" at some point or another. After they realize that everyone laughs at them when they say that, they start describing themselves as a transdyke. This is done under the idea that if you use a word people don't understand, they take you more seriously.
A: I'm a lesbian trapped in a man's body
B: You're an idiot.

vs.

A: I'm a transdyke
B: *confusion*
by buki March 17, 2007