Legal gender recognition (LGR) refers to laws, policies, and administrative procedures that enable transgender and gender diverse (TGD) people to update their legal identity documents (ID) to reflect their self-determined gender. We conducted a systematic review and meta-analysis on the health effects of LGR and a nested scoping review of TGD people's LGR-related values and preferences (PROSPERO CRD42023441769). We searched seven databases through April 19, 2024, and organization websites (for grey literature) through August 2023. The effectiveness review included quantitative studies evaluating the effect of LGR (policies or possession of gender-concordant ID) on seven domains of health and well-being. We conducted random-effects meta-analyses when possible and otherwise used narrative synthesis. Study risk of bias and confidence in the cumulative evidence were assessed using the ROBINS-E and GRADE, respectively. We screened 2748 studies and included 24 in the effectiveness review. In meta-analyses, LGR was associated with less suicidal ideation (OR = 0.75; 95 % CI: 0.56-1.00, I² = 46 %) and psychological distress (e.g., OR for LGR on all versus no ID = 0.53; 95 % CI: 0.40, 0.70, I² = 17 %). LGR may reduce anticipated discrimination, increase healthcare utilization, reduce gonadectomies, and improve socio-economic status, but the evidence was very uncertain. We included 31 studies on TGD persons' values and preferences. They perceived well-being benefits of LGR, had diverse personal preferences related to safety, and reported financial and policy barriers to LGR. In conclusion, LGR may improve TGD mental health and is perceived to reduce exposure to stigma and discrimination. Higher-quality effectiveness research is needed on other health and well-being outcomes, as well as research to evaluate specific LGR policy provisions.