California has become the first US state to require large retailers to display toys and childcare items in gender-neutral ways.
The new law, signed by Governor Gavin Newsom on Saturday, does not ban boys and girls sections in shops.
But large stores must have also have a separate, gender-neutral section.
These must display "a reasonable selection" of toys and childcare items, regardless of whether they've been marketed towards a particular sex.
Companies will face a $250 (£184) fine for their first violation, and $500 (£368) penalties for others.
The new law was passed by California's state legislature last month, and will come into effect in 2024 now it has been signed by Governor Newsom.
It will apply to retailers with 500 or more employees across their California stores.
Clothing will be unaffected, but the law will affect toys and any "childcare items" intended to aid sleep, relaxation, feeding, teething or sucking.
In its wording, it said the changes would help consumers spot "unjustified differences in similar products" and tackle gender bias in children's products.
Democrat Assemblyman Evan Low, one of the law's co-authors, has previously said the bill was inspired by his staff member's eight-year-old daughter, who asked her mother why she had to go to the boys section to find a certain toy.
"The segregation of toys by a social construct of what is appropriate for which gender is the antithesis of modern thinking," said Mr Low in a statement.
He said that categorising toys by gender had "led to the proliferation of science, technology, engineering and mathematics-geared toys" in boys sections, while those for girls were directed towards pursuits like "caring for a baby, fashion, and domestic life."
The Consumer Federation of California, a consumer advocacy group, has been among those in favour of the law.
In a statement to The Sacramento Bee newspaper, it said separating products by gender "helps to disguise the unfortunate fact that female products are often priced higher than male products."
Some US retailers have already taken steps away from gender stereotypes in their businesses. In 2015, Target announced that it would stop using some gender-based signs in its stores.
But in the last two years, similar bills to enforce gender-neutral commercial spaces have been shot down in California's legislature.
Detractors have argued that it infringes on free speech, and business owners' ability to adapt to the free market.
One of the most most vocal critics has been the California Family Council, a conservative advocacy group. It has accused gender-fluid clothing entrepreneur Rob Smith of lobbying for the bill for his own commercial gain.
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