Campaigners fear a new hate crime strategy could see comedians who make jokes about transgender issues hauled in front of a judge.
A barrister warned telling jokes about trans people, like Ricky Gervais in his most recent show, could be criminalised if a new Home Office plan is put in place.
Priti Patel's department dismissed the claims and said it will protect free speech.
Its new strategy is due to be published shortly, with a Home Office minister saying it will "set out steps to increase the reporting of all forms of hate crime – including hate crimes targeting sexual orientation or transgender identity".
They will see "perpetrators" accused of "non crime hate incidents" [NCHIs], which are recorded on police systems. It comes after the Court of Appeal ruled that College of Policing guidance telling forces to record incidents believed to be 'motivated by a hostility or prejudice against a person' as NCHIs violates the European Convention on Human Rights.
But Sarah Phillimore, a barrister from Fair Cop, a group describing itself as a "gender critical" organisation of lawyers, police officers and writers, said: "It is astonishing that legislators are planning to expand the discredited and unlawful practice of recording non-crime hate incidents [NCHIs]."
She told MailOnline that the strategy could put police on the wrong side of the law, saying: "Police forces that record complaints against comedians - or any other lawful speech - as NCHIs will be piling illegality upon illegality.
"They will then find themselves in court with no legitimate defence. This quixotic strategy oozes arrogance, as if the law does not apply if you're fighting for 'the right side of history'.
"But how can you be on the right side of history if you're repeatedly on the wrong side of the law?"
A Home Office spokesperson hit back: "These claims are completely wrong - there are no plans to expand recording of non-crime hate incidents, nor will we criminalise comedians or introduce a complaint scheme. Free speech is a fundamental right and we will always protect it.
"Our approach will ensure the police are focussing their resource on serious and harmful hate crimes, such as violent assaults and attacks on places of worship."
Ricky Gervais' most recent show, Supernature, triggered a row over jokes about trans people.
In the show, Mr Gervais said: "Oh, women. Not all women, I mean the old-fashioned ones. The old-fashioned women, the ones with wombs. Those f****** dinosaurs.
"I love the new women. They're great, aren't they? The new ones we've been seeing lately. The ones with beards and c***s. They're as good as gold, I love them.
"And now the old-fashioned ones say, 'Oh, they want to use our toilets.' 'Why shouldn't they use your toilets?' 'For ladies.' 'They are ladies - look at their pronouns! What about this person isn't a lady?' 'Well, his penis.' 'Her penis, you f****** bigot!' 'What if he rapes me?' 'What if she rapes you, you fucking TERF w****?'"
He said at the end of the show: "Full disclosure: in real life of course I support trans rights. I support all human rights, and trans rights are human rights.
"Live your best life. Use your preferred pronouns. Be the gender that you feel you are. But meet me halfway, ladies. Lose the c***. That's all I'm saying."
Some branded the comedian a "coward" who is "making cheap, nasty stereotypes out of a minority group" while others defended the jokes as funny.
Jokes about trans issues and people have taken centre stage thanks to an ongoing row involving US comedian Dave Chapelle.
He triggered controversy with his show The Closer, in which he said "gender is a fact" and supported Harry Potter author JK Rowling, who has also attracted criticism for her comments about sex.
