From The Language of Sex A to Z by Dr. Robert M. Goldenson and Kenneth N. Anderson:
Transgenderism: a gender identity disorder in which a person strongly identifies with the opposite sex and may cross-dress, yet does not wish to undergo sex-change surgery. The confusion of sex roles usually stems from a failure of one or both parents to provide adequate sex-role models.
Transsexualism: a gender identity disorder characterized by a persistent sense of discomfort and inappropriateness wit one’s anatomic sex, as well as an obsessive need to change one’s sex organs and live and dress as a member of the other sex. According to the American Psychiatric Association, the diagnosis is made only if the condition has been continuous for at least 2 years and does not stem from other mental disorders, such as schizophrenia, and is not associated with physical intersex or genetic abnormality.
Transvestism: a psychological disorder usually characterized by a persistent, often compulsive, urge to wear clothes of the opposite sex as a means of achieving sexual excitement. Cross-dressing, as it is also called, is usually observed among basically heterosexual males whose sexual experience with women is limited and who may have occasionally engages in homosexuals acts. In many cases their mothers dressed them as girls in childhood because their mother (or father) wanted a girl child. In some instances cross-dressing was used as a “petticoat (or pinafore) punishment.”