The bill said a medical diagnosis of gender dysphoria is no longer required to change a person's gender and ‘self identify’ would be legally accepted.
The legislation would also make it easier for transgender people to obtain official gender recognition certificates, and those 16 or over could apply for one.
It also slashes the waiting time for approval from two years down to six months.
However, Scottish Secretary Alister Jack said he would invoke Section 35, which prevented the Gender Recognition Act from being reformed.
In a media release, Secretary Jack said the decision was based on the ‘legislation’s consequences for the operation of GB-wide equalities protections and other reserved matters’.
He added: “I have not taken this decision lightly.
"The Bill would have a significant impact on, amongst other things, GB-wide equalities matters in Scotland, England and Wales.
“I have concluded, therefore, that this is the necessary and correct course of action.”
He added that if the Scottish Parliament chooses to submit an amended bill, he hopes they can ‘work together to find a constructive way forward that both respects devolution and the operation of UK Parliament legislation’.
But Scotland's First Minister, Nicola Sturgeon, called the move a ‘full-frontal attack’ while vowing she would fight for the bill to be passed.
She tweeted: “This is a full-frontal attack on our democratically elected Scottish Parliament and it's ability to make it's own decisions on devolved matters. @scotgov will defend the legislation & stand up for Scotland’s Parliament.
“If this Westminster veto succeeds, it will be first of many.”
Scottish Social Justice Secretary Shona Robison said it was a ‘dark day for democracy in the UK’ in the wake of the British Government enacting Section 35, as per BBC News.
While The Guardian reported, Greens MSP Maggie Chapman said the Scottish Parliament would oppose the strike down of the act.
She said: “Only one month ago, MSPs voted overwhelmingly for gender recognition reform.
“It was a proud day for equality, and for our parliament. To see a reactionary Tory government trying to block or overturn it is nothing short of outrageous, and we will resist them every step of the way.”Featured Image Credit: Russell Hart/Alamy Live News. gerard ferry / Alamy Stock Photo