Individuals with Differences in Sex Development (DSD) are either identified at birth by the presence of atypical genitalia or at later stages due to amenorrhea or subsequent health-related concerns (such as salt-wasting type in Congenital Adrenal Hyperplasia, CAH). The birth of a child with DSD is often considered a psychosocial emergency. Parental reports suggest that the early days of getting acquainted with their child’s DSD condition are traumatic to a degree comparable to that experienced by parents of children diagnosed with Cancer. They find themselves struggling to cope with the ambiguity regarding their child’s future physical and gender development. Parents are faced with the challenge of making surgical decisions for their children based on medical information given to them while simultaneously coming to terms with their child’s diagnosis. Surgical intervention during infancy and childhood is controversial with varying outcomes. Although documented literature exists for gender identity outcomes for certain DSD conditions, it is not true for all, as DSD is a rare and heterogenous group of congenital conditions. Even for those conditions where data exists on gender identity development, there are exceptions to the rule. Since gender identity cannot be predicted with utmost certainty at birth, any surgical intervention during infancy comes with an element of risk. In cases of unfavorable outcomes, wherein the child’s gender identity is discordant with the surgical intervention during infancy, it can lead to profound psychological distress for the child. Therefore, clinical management not only involves the medical management of DSD but also careful consideration of several psychological and psychosocial factors. These factors include psychoeducation, information management, gender assignment, genital surgery, gender reassignment, and sexuality. The following chapter takes a developmental perspective to discuss these psychosocial factors and the relevant psychosocial rehabilitation strategies that can be used to mitigate psychological distress among children with DSD.