According to Judge Lefkowitz, a Supreme Court judge in Westchester County, the answer is "yes".  As the issue was decided in the case of Buffong v. Castle on the Hudson:

A state court has held in an apparent case of first impression that New York state's Human Rights Law protects transgendered individuals.

"Transgendered persons are either male or female," Westchester Supreme Court Justice Joan B. Lefkowitz held in Buffong v. Castle on the Hudson, 11634/05. "Case law supports the view that a transgendered person states a claim pursuant to New York State's Human Rights Law on the ground that the word 'sex' in the statute covers transsexuals"...

While at least one federal decision has held that the state's Human Rights Law, which does not specifically refer to transgendered individuals, nonetheless applies to them — Rentos v. Oce-Office Systems, 1996 WL 737215 — this case marks the first time a state court has done so, according to the decision and papers submitted by both sides.

In this case, the plaintiff worked as a line cook at a restaurant and it was eventually discovered by his co-workers that "he" was actually "she" in wolf's clothing.  In his lawsuit, he alleged that after 4 months of harassment by his co-workers he was terminated based upon his status as a transgendered individual.

The defense argued that transgendered individuals were intentionally excluded from the Human Rights Law, while the plaintiffs argued that they were not necessarily excluded simply by virtue of that fact.  In reaching its decision the Court stated: 

Unlike the New York City Human Rights Law which specifically includes transgendered persons . . . the New York State Legislature has not adopted proposed legislation that would accomplish that fact...

Nonetheless, prior to amendments to the New York City Code to specify transgendered persons as included persons, the courts had held that the prior definition, similar to the State definition . . . did cover transgendered persons..."

This Court agrees that plaintiff's claim falls within the liberal interpretation to be accorded to the New York State Human Rights Law.

This is an interesting decision and one that I expect will be appealed.  I wonder if the appellate courts will overturn it?

And, it raises an interesting philosophical issue.  As it stands now, the Human Rights Law protects one from discrimination based upon one's gender.  But, is the alleged discrimination that occurred in this case based upon the plaintiff's gender or the fact that the plaintiff chose to dress in a way that was not consistent with her gender?   How different is the alleged harassment in this case from that that one would encounter if one chose to wear a clown suit at all times?

Personally, I think that transsexuals and transgendered people should be protected from discriminatory harassment, etc. based upon their status.  But, I'm not sure that I buy the rather liberal interpretation that the courts are applying to the protected class based upon one's "sex." But, then again, I haven't read the line of cases that have lead up to this conclusion. Nevertheless, the best fix would be to amend the Human Rights Law in order to avoid this logical leap.