Correctly recognizing gender identity in population-based surveys is essential to develop effective public health strategies to improve the living conditions of transgender and gender-diverse populations, as well as to adequately collect data on cisgender individuals. This study aims to present the two-step measure as the best strategy for assessing gender identity in Brazilian surveys, thus we performed two separate analyses. Firstly, we conducted a systematic review concerning HIV-related care among Brazilian transgender and gender-diverse populations to assess the strategy used to identify participants' gender identity. Secondly, we re-analyzed data from a recent survey that included Brazilian transgender populations, comparing characteristics and health outcomes from the sample identified by single-item and by the two-step measure. Concerning the systematic review, from 6,585 references, Brazilian research teams published seven articles, and only one study used the two-step measure. Regarding this survey, the two-step measure recognized 567 cisgender and 773 transgender and gender diverse participants among the 1,340 participants who answered the questionnaire, whereas the single-item measure was able to recognize only 540 transgender and gender diverse people. Furthermore, 31 transgender women self-identified as "transgender men" on the single-item measure. Therefore, although scarcely used in Brazil, the two-step measure is a more accurate strategy to recognize gender identity.