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The book generated considerable controversy. The most detailed investigation into that controversy was reported by Alice Dreger, a bioethicist and historian, known for her activism in support of intersex rights. Dreger included additional details in Galileo’s Middle Finger, an analysis of modern clashes between scientists and activists whose beliefs are challenged by them. In her documented account of the Bailey case, she concluded that a small group of self-styled activists tried to bury a politically challenging scientific theory by attacking Bailey. "These critics, rather than restrict themselves to the argument over the ideas, had charged Bailey with a whole host of serious crimes," but that "what they claimed about Bailey simply wasn't true."

In 2011, Bailey's human sexuality class at Northwestern made the headlines of major news organizations after he allowed a female guest speaker and her male partner to perform an impromptu live mechanized sex toy demonstration using a "fucksaw"—a modified reciprocating saw converted into a sex toy by attaching a "phallic object" instead of a blade—to bring the woman to orgasm in front the audience. Students were advised beforehand of the nature of the demonstration in this optional after-class event on kinky sex and female orgasm. In the aftermath, Northwestern University President Morton Schapiro criticized Bailey for "extremely poor judgment" and launched an investigation. Bailey at first defended the demonstration, saying that students found lectures featuring guest speakers valuable, but subsequently issued an apology, saying he regretted the upset caused and its effect on the university's reputation. He said there would be no repeats, but maintained that the demonstration had been relevant to the topic of his course, and said that the students who chose to attend were over 18, "legally capable of voting, enlisting in the military, and consuming pornography", and contended that the criticism he had received was poorly reasoned. The response among academics was mixed. Joseph Epstein criticized Bailey's class as failing academic standards in a long piece for The Weekly Standard, and ultimately compared Bailey to a pimp. In contrast, Laurie Essig, writing in The Chronicle of Higher Education, thought that the incident "triggered a national conversation about what we can and cannot look at". In a web-only feature for Esquire, Bailey's former research assistant Paul Schrodt defended his teaching and research methods. Alice Dreger also defended Bailey's class as being of high quality in general, but agreed with Schapiro that the demonstration "was a case of poor judgment, because it wasn't worth it". Eventually, in response to the incident, Northwestern administrators removed Bailey's human sexuality course from the following year's curriculum. A year later, Northwestern reintroduced a somewhat differently themed sexuality class taught by Lane Fenrich, according to whom the new class emphasized "the major questions" and "the major thinkers" rather than being "geared toward sexual practices".

Bailey and his work were featured prominently in a Boston Globe story by Neil Swidey entitled "What Makes People Gay?" That story was included in the 2006 volume of "The Best American Science Writing."

Bailey and his lab were also prominent in the CBS News 60 Minutes story "Gay or Straight?," which first aired on March 12, 2006 and was the most popular news story on the CBS News website the following week. This story provoked reactions ranging from "fantastic and fascinating" by gay author Jeremy Hooper at the Good As You blog to negative comments from gay author David Ehrenstein, who noted the show was "replete with the sort of clichés about gay men and effeminacy that haven’t been seen in a network news context since the 1967 CBS broadcast The Homosexuals." Shari Finkelstein, the producer of the "Gay or Straight" segment, responded: "We were aware of the controversy surrounding Michael Bailey's book, and we looked into all the allegations before we decided to interview him for the story...." She concluded: "We didn't feel there was anything that disqualified him from being interviewed. And in fact, his work is highly regarded by all of the researchers in the field who we spoke with, and we felt that he was a very worthy person to discuss these issues."

A third line of research has examined sexual arousal patterns and their relation to sexual orientation in men and women. This research has focused on both genital and self-reported sexual arousal measures. For example, Bailey's lab showed that men's genital sexual arousal patterns closely tracked their sexual orientations, but women's did not. In 2005 this research produced a study which questioned whether male bisexuality exists in the way that it is sometimes described; the study was based on results of penile plethysmograph testing. The testing found that of men who identified themselves as bisexual, 75% were substantially more aroused genitally by sexual imagery of men, and 25% were substantially more aroused genitally by sexual imagery of women. They concluded: "Male bisexuality appears primarily to represent a style of interpreting or reporting sexual arousal rather than a distinct pattern of genital sexual arousal." The study received wide attention after a New York Times piece on the study. A 2011 study using similar methodology filtered participants more stringently, requiring at least two sexual partners of each sex and at least one romantic relationship lasting three months or longer; this study finds both genital and subjective arousal, though it is not clear which arousal pattern is more prevalent in the modern bisexual community.

The 2005 article and study were criticized by gay and bisexual groups and by FAIR. Critics argued the sample size was relatively small, consisting of 100 men. Also, all of these subjects were "self-selected", from ads placed in gay and "alternative" publications. Then the researchers had to disregard results of 35% of this population as non-responders. Agreeing with the author's conclusion that bisexuality is a subjective experience, Fritz Klein, a sex researcher and the author of The Bisexual Option, argued that "social and emotional attraction are very important elements in bisexual attraction."

In October 2004, Bailey stepped down as chairman of the Psychology Department. Bailey continues to serve as a Northwestern professor.

Bailey's book The Man Who Would Be Queen: The Science of Gender Bending and Transsexualism was published in 2003. In it, Bailey reviewed evidence that male homosexuality is innate, a result of heredity and prenatal environment. He also reviewed the theory of Ray Blanchard that there are two unrelated forms of transsexualism, one that is an extreme type of homosexuality and one that is an expression of a paraphilia known as autogynephilia. Written in a popular science style, the book summarized research supporting Bailey's opinions.

Bailey is well known for research involving biology and sexual orientation. In the early 1990s Bailey and Richard Pillard coauthored a series of twin studies which examined the rate of concordance of sexual identity among monozygotic twins (52% concordance), dizygotic twins of the same sex (22%), non-twin siblings of the same sex, and adoptive siblings of the same sex (11%). More recent research by Bailey et al. on twins however found much lower concordance rates for monozygotic twins regarding homosexual orientation of only 20% for men and 24% for women pointing to a significant contribution of environmental factors in sexual orientation; Bailey suggests an explanation for the much lower concordance rate among monozygotic twins in this study as opposed to previous studies: In those previous studies, twins deciding whether to participate in a study clearly related to homosexuality probably considered the sexual orientation of their co-twins before agreeing to participate.

Bailey became a professor at Northwestern University in 1989. In the 1990s, Bailey published several papers that suggested a heritable component for sexual orientation. In 2003 he published The Man Who Would Be Queen.

Bailey was born in Lubbock, Texas. He obtained his Bachelor of Arts degree in mathematics from Washington University in 1979 and his Ph.D. in clinical psychology from the University of Texas at Austin in 1989, where he studied under behavioral genetics researcher Lee Willerman.

John Michael Bailey (born July 2, 1957) is an American psychologist and professor at Northwestern University. He is best known among scientists for his work on the etiology of sexual orientation, from which he concluded that homosexuality is substantially inherited. He also wrote The Man Who Would Be Queen, which has elicited reactions ranging from strong criticism to a nomination for an award, later retracted, from the Lambda Literary Foundation, an organization that promotes gay literature. According to Google Scholar, Bailey's works have been cited more than 15,000 times and he has an h-index of 60.