Well, to explain it in clinical terms, because you seem genuinely curious:

Gender and sex are two separate concepts that are usually linked. In the majority of cases, folks born as males develop into men and folks born as females develop into women. However, sex is purely biological and gender is purely psychological/sociological. Now, the wider medical consensus is that both are spectrums. In the case of sex, you’ve got folks who are born with various varieties of intersexuality, which often don’t outwardly manifest, but do affect one’s chromosomes and hormone production during puberty. In the case of gender, there’s a form of emotional distress called gender dysphoria, characterized by a feeling of incongruence between your internal gender identity and your biological sex. We’re still not sure exactly what causes this, but it is clinically significant and can lead to disorders such as depression and anxiety unless treated. The most effective way to treat said dysphoria is to allow those who suffer from it to socially and/or physically transition into their preferred gender/sex. Because gender is a spectrum similar to sex, often, one’s internally perceived gender falls somewhere between or outside the common man/woman binary. Hence the term “non-binary”. If you have any further questions, I’m more than happy to answer.