US President Donald Trump's controversial ban on transgender Americans in the military comes into force today following a protracted legal battle.

Mr Trump's administration has insisted that there is "too great a risk to military effectiveness and lethality" to allow transgender people to serve - reversing a policy enacted under his predecessor Barack Obama.

The Pentagon says the restrictions are not a blanket ban, but they would bar many if not most people who identify as transgender from enlisting in America's armed forces.

The policy - which has undergone various iterations since Mr Trump first announced it on Twitter in July 2017 - has been widely criticised by rights activists and has been repeatedly challenged in court.

The US Supreme Court ultimately ruled in January that the policy could take effect pending the outcome of ongoing litigation.

Under the latest version of Mr Trump's policy, no one who has transitioned to another gender, been diagnosed with "gender dysphoria" or who requires hormone treatment will be able to enlist.

But currently enlisted troops who have already transitioned or have requested gender reassignment surgery prior today will be allowed to remain in the military.

For Aaron Belkin, director of the Palm Centre, a research institute focusing on sexual minorities in the military, the policy amounts to a transgender ban.

"When (the Department of Defense) disqualifies all applicants with a history of gender dysphoria (unless they renounce transgender identity for years) and all applicants who have ever received treatment for gender dysphoria, that is a ban," Mr Belkin said.

Protesters march against the ban in New York last July (file photo)

The policy "depends on directly banning the transgender people who are immediately identifiable and threatening the rest, forcing them to remain silent and invisible," he said.

"It is 'don't ask, don't tell' all over again," said Mr Belkin, referring to the policy under which gay service members had to hide their sexual orientation or face dismissal from the military.

Under the Obama-era policy, transgender recruits were to start being accepted by 1 July 2017.

The Trump administration postponed that date to 1 January 2018, before deciding to reverse the policy entirely.

The Pentagon estimates that 9,000 people who identify as transgender are currently serving in the military, out of a total of 1.3 million active-duty personnel.

Of this figure, 1,000 say they have undergone gender reassignment surgery or want to do so.

But according to transgender rights activists, the figure is higher.

"As many as 15,000 transgender service members stand to lose their jobs," Army Staff Sergeant Patricia King, who is transgender, told ABC News this week.

"For those of us who are grandfathered in because we've already come out and we already have a diagnosis, there's the possibility for systematic discrimination," King said.

The new policy is "indefensible," Meghan McCain, daughter of the late senator John McCain, wrote on Twitter.

"This discriminatory policy will lead Transgender service members, patriots who have decided to serve their nation, to live in the shadows," she wrote.