From this year, women's and men's categories in Myer Fashions on the Field, will be replaced with Best Dressed and Best Suited awards.

People are encouraged to enter the category that matches their personal style, rather than their gender identity.

Ms Saywell, who is the founder of bespoke queer label Shane Ave, said it was a step in the right direction for the Australian fashion industry.

"I love the idea. I think it's absolutely amazing, where we can move into that space where fashion is not gender specific," she said.

Victoria Racing Club's (VRC) change of rules for fashions on the field is part of the club's 60th anniversary celebrations, chair Neil Wilson said.

"We are ensuring that our fashion story drives equality, inclusion and individuality as we set course for the next 60 years," he said.

"We proudly embrace the notion that fashion, and style are an expression of individual creativity and believe this should be reflected in the international event."

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Ms Saywell said the VRC's choice to discard gender binaries opens the categories up to her community.

It also allows queer people to be recognised for expressing themselves through fashion, she said.

Despite the move, Australia still has a long way to go in fashion inclusivity, with the country still "very much behind the eight ball".

Ms Saywell founded her Sydney-based label in 2019, the same year marriage equality was passed in Australia, in an effort to create gender neutral formal attire for the queer community.

While there are several places that offered suit options for lesbians, trans men and non-binary people, she said no one catering specifically for the queer community.

"The gap was not just for the suiting, but creating a safe space and environment, where they won't be judged," she said.