A very non-PC term often used as a malapropism for sexual orientation. Because the commonly held belief of LGBTQ people is that that one's sexual attraction (i.e., sexual orientation) is not a choice, many people will be offended by the term sexual preference because it seems to imply that there is a choice in one's orientation.

The only situation which this might possibly be used correctly is with bisexual people, where sexual preference might refer to the sex or gender who they find themselves mostly oriented towards, but even this is not generally used.

Basically, you should probably avoid this term at all costs. Here are some alternatives:

The latter is perhaps the trickiest one, because many people don't understand that one's sexual identity can be different from one's sexual orientation and sexual behavior. A person defines his or her own sexual identity, and frequently there may be discord between these three facets of sexuality. For instance, a man who identifies as heterosexual and has a heterosexual orientation may under abnormal circumstances engage in homosexual behavior. Or, a woman who identifies as homosexual may have a heterosexual orientation though she engages in homosexual behavior. Or virtually any other combination there is.

My main point here is that "sexual preference" does not fit into this model anywhere, because it is another result of misleading language being accepted in everyday speech.

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