From PEOPLE Magazine Click to enlarge
Chaz Bono isn't used to being chased by the paparazzi. "I don't think anyone can understand how jarring it is to walk to your car and have somebody jump in front of you with a camera," he says. But the unwanted attention—which exploded after he announced his decision to undergo the process of gender reassignment in June—does have an upside. "Somebody who had just started testosterone recently came up to me," says Bono. "He said watching me come out about this really helped him finally get started."

Inspiring other transgendered people is only one of the reasons that Bono, 40, now describes himself as "a happy guy." Following through on his plan to "honor his true identity" by living as a man has been "awesome," he says. But the child of Cher and Sonny Bono struggled for decades with his sense of self. (Transgender people believe they were born as the wrong sex, so PEOPLE will refer to Chaz as "he" even when referring to past events, to reflect what Bono considers his true gender.) Born as a female whom his parents called Chastity, he hated wearing dresses on The Sonny and Cher Show and later admitted that he preferred "clothes that matched my father's." Though he came out as a lesbian in 1995, Bono began questioning his gender identity about six years later, all the while battling addictions to alcohol and drugs. "I've been clean and sober for a long time now, and that helped me find the courage [to do this]," says Bono. "It was a combination of things like therapy and becoming more mature."

Each step in the four- to five-year sex-reassignment process has felt like a rebirth to Bono—especially when he had his breasts removed in September. (Reluctant to publicly discuss any further surgical procedures, Bono simply says, "I'm keeping my privates private.") "Before, I was really detached from my body, so it was really hard to really care about it," he says. "Because no matter what I did, it always looked in a way that was incredibly uncomfortable for me." He feels the mastectomy fixed that problem. "Before I hit puberty, I always walked around with my shirt off," says Bono. "I can finally do that again—and it's awesome!"

Taking testosterone as part of the transition has also had a physical payoff: Bono, who famously did a stint on VH1's Celebrity Fit Club in 2006, has begun working out regularly with a trainer. "My body is starting to respond the way that I've always wanted it to," he says. "So it's a lot easier to put effort into it." Another benefit of the hormones? Bono says he's more assertive and can get angry in a more productive way, "instead of blaming myself and just feeling bad."

Embracing the man he feels he has always been has strengthened his bond with his girlfriend of four years, graduate student Jennifer Elia, 34. "For the most part, it's gotten much better, because I'm in such a better place," says Bono. "Once I started to actually deal with [my identity issues], everything in my life got easier. I'm a better version of myself. I'm just more present now and more engaged." The "homebodies" love nothing more than a quiet night alone (well, sort of: They have two dogs and four hairless cats) at their West Hollywood, Calif., house, watching movies over dinners he cooks. Says Bono: "I'm really good at Italian cooking, because I grew up watching my dad in the kitchen."

While he won't comment on how his mother, Cher—who told PEOPLE in June that she supported his decision, though she didn't fully understand it—has reacted over the past several months, Bono says, "Everybody in the family is doing the best that they can. I've gotten, for the most part, a lot of really incredible support." It's important to him that others like him feel that same level of support, so in addition to doing a documentary and a book about his journey, he's spoken at the Transgender Law Center in San Francisco and is working with transgendered kids and their families. "I'm in awe of a child who is 5 or 6 and can articulate that they are transgender," says Bono, "and a parent who is then able to accept that and do whatever they can to make their child's life and their transition easier."

And now that he is beginning to emerge on the other side of all those painful and confusing questions, he feels overwhelmed. "It's hard for me to articulate how this feels—when you've lived your whole life in a body and having everybody relate to you as something you don't feel," says Bono. "When that finally gets righted, it's just amazing. I finally get to live my life the way I've always wanted to."