Traditionally we think of sexual orientation as being straight, lesbian, bisexual or gay. Sometimes people say being asexual is a sexual orientation too.
Gender identity is a bit more complicated. If you identify with the gender you were born with, you are considered to be cisgendered.
Transgender people identify as something other than the biological sex they were born as. Just as sexual orientation can run a spectrum from strictly heterosexual to strictly homosexual (See the Kinsey scale) gender identity can run a spectrum too. Some people identity as Male-to-Female transsexual, Female-to-Male transsexual or some prefer the words transgender or genderqueer to mean they don't quite fit into any one box.
How we think about gender is evolving and I suspect we will come to understand more about gender identity and gender expression as more people come out as transgender and help us understand what it means to them.
