From a recent Yahoo News article:
Then, in 2012, the IOC made a landmark decision which allows transgender athletes to compete amongst their chosen peers, with some conditions. Both FTM and MTF trans athletes must meet three main requirements: the athlete must have had gender reassignment surgery, the athlete must have legal recognition of his or her assigned gender in his or her home country, and the athlete must have completed at least two years of hormone therapy. This third requirement is mostly for MTF athletes, as two years of hormone therapy are required to erase the natural androgen-driven physical advantage of testosterone.
It sounds like female athletics will eventually be absorbed into the male category. This ruling encourages other polities to legally recognise transgender sex changes as well, so that transgender males may compete as female and win.
Also see: A related news article on “outrage” over other gender testing done by the IOC.