School toilets have been identified by sexuality and gender diverse (SGD) students as the least safe spaces in educational institutions. They are sites of verbal, physical and sexual victimisation. Providing gender-neutral toilets in primary and secondary schools may reduce the bullying and victimisation of SGD students, particularly those who are transgender or gender-diverse. This study explored factors influencing the inclusion of gender-neutral toilets in primary and secondary schools in Western Australia. Thirty-four interviews were conducted from May to December 2020 with policy makers or practitioners (n = 22) and school staff (n = 12) in Perth, Western Australia. Interviews were conducted online and face-to-face using semi-structured interview guides. A thematic analysis of the cross-sectional qualitative data was undertaken. School staff, policy makers, and practitioners identified school toilets as sites of bullying and victimisation of SGD youth and expressed support for gender-neutral toilets as an anti-bullying strategy. Perceived barriers to introducing gender-neutral toilets in schools included financial and spatial costs, building code compliance constraints, resistance from parents and students, privacy and confidentiality concerns, and cultural appropriateness. Including gender-neutral toilets in schools may reduce school-based bullying and victimisation, and improve the mental and physical health of SGD youth.