A portmanteau of Tyrannosaurus (the dinosaur fixture of popular culture) and tranny, slang for a transgender person or a cross-dresser. So: T. rex as a drag queen.
Tranny is often perceived as derogatory, but it’s been reclaimed in many contexts — for instance, in the name of the San Francisco drag club Trannyshack. Trannyshack webpage here, Wikipedia entry here:
Trannyshack is a monthly drag club taking place at DNA Lounge in San Francisco. It was started by drag queen Heklina in 1996 as an offshoot of Klubstitute, and was a weekly fixture at The Stud bar in San Francisco for 12 years, drawing large crowds on a regular basis. The Tuesday night performances at The Stud ended on 12 August 2008, with Trannyshack resuming as a monthly event at DNA Lounge in March 2010.
(The Stud goes on. Both The Stud and DNA Lounge are in the SOMA (South of Market) district of the city — on 9th and 11th Sts., respectively.)
A fixture of S.F. gay life.