Poison and Roxy appear as two minor enemies in the game Final Fight. They are “palette swaps” for one another, simply meaning that they are the same basic design element with different hair and clothing colors to make them visually distinct. Reportedly, the characters were originally going to be women, but developers thought that this would lead the game to do poorly and be protested in America—the developers thought that Americans would find hitting women distasteful. Instead, the characters were described as transvestites, oddly enough to appease feminists, as Austen Crowder points out. When the game was released for the Super Nintendo, Poison and Roxy were swapped out for male characters (Billy and Sid), because a playtester read the women as cisgendered women (Crowder, 2009).
There has been a great deal of ongoing debate as to whether Poison and Roxy are transvestites, trans women, or transsexual women (including a lot of discussion of whether they are pre- or post-op). Most recently, producer Yoshinori Ono has stated that Capcom will not take a stance on Poison or Roxy’s gender identity, as they prefer to leave it up to the fans to decide for themselves (Patterson, 2011).

Poison in Final Fight Image credit http://criticsight.com/2012/especial-la-creacion-de-final-fight-los-enemigos-primera-parte-poison-y-roxy
The video below shows Poison and Roxy in action. Poison appears at 1:20. Roxy, who looks very similar to Poison (except for the orange hair), can be seen earlier.
Poison is also featured in Street Fighter series, as well as Street Figher x Tekken (where she makes her debut as a playable character).

Poison Image credit http://gaygamer.net/2015/01/ggoty-2014-gayest-games-of-the-year
LGBTQ references in this game:
See also, LGBTQ references in Street Fighter series
Citations:
- Crowder, A. (2009, December 20) Videogame Censorship, LGBT, and Birdo (Part II). The Bilerico Project. http://www.bilerico.com/2009/12/videogame_censorship_lgbt_and_birdo_part_ii.php
- Final Fight Revenge. (n.d.). Retrieved from http://en.wikipedia.org/wiki/Final_Fight_Revenge
- Garcia, T. (2012, March 26). A Brief History of Transgender Characters in Video Games [Updated]. https://transgamersociologist.wordpress.com/2012/03/26/a-brief-history-of-transgender-characters-in-video-games/
- Harper, T. (2015, March 26). From Purgatory: Poison, Birdo, and Trans Character Discourse. Stay Classy. http://www.chaoticblue.com/blog/2015/03/from-purgatory-poison-birdo-and-trans-character-discourse/
- LGBT Themes in Video Games. (n.d.). Retrieved from http://en.wikipedia.org/wiki/LGBT_themes_in_video_games
- Mattos, S. (January 2, 2015). GGOTY 2014: Gayest Games of the Year. Retrieved from http://gaygamer.net/2015/01/ggoty-2014-gayest-games-of-the-year
- Palette Swap. (n.d.). Retrieved from http://en.wikipedia.org/wiki/Palette_swap
- Patterson, E.L. (October 10, 2011). EGM Interview: Street Fighter X Tekken’s Yoshinori Ono. EGM. Retrieved from http://www.egmnow.com/articles/news/egm-interviewyoshinori-ono/#
- Poison. (n.d.) Retrieved from http://capcom.wikia.com/wiki/Poison
- Poison. (n.d.). Retrieved from http://streetfighter.wikia.com/wiki/Poison
- Poison (Final Fight). (n.d.). Retrieved from http://en.wikipedia.org/wiki/Poison_(Final_Fight)