This article was written in 2015 (whew, that was a while ago huh) and posted on my tumblr, which has since been abandoned. Since gender on the mushroom kingdom has become a hot topic as of late, I figure it was time to repost and revisit it.
First, the original article:
The inhabitants of the mushroom kingdom, widely known as Toads, are indeed monosexed. They all have the same sexual characteristics and reproduce asexually, like fungi. This does not mean they are monogendered, they may have been at one point, but perhaps by the influence of other creatures have developed a concept of gender, as demonstrated by several toads who take on human genders, such as:

Toadette, who takes on a female gender. And uses she/her pronouns. And

Toadsworth, who takes on a male gender and uses he/him pronouns.
Most toads are genderless and are often confused for male.

Possibly because in English they use male pronouns as the default. It is currently unknown if Toads have their own language and what they use for pronouns, or if they have adopted pronouns for adopted and new genders.
It is indeed possible for toads to take on completely different genders than humans take, including genders exclusive to Mushroom society.
To contrast, consider the Dwarfs of Discworld, who are polysexed and reproduce sexually, however are monogendered and apparently lack secondary sex characteristics that would help them differentiate. Indeed, they all use he/him pronouns and traditional male monikers such as King and foreman. More research is necessary to ascertain how this relates to their own language and it’s attitude towards gender.
In short, Toads are monosexed, but polygendered, however, often genderles. Whereas Discworld dwarfs are polysexed, but monogendered.
ETA (Apr 2016): This Article implies a distinction between sex and gender that the author now understands is a harmful concept since, at least in humans, sex and gender are social constructs that denote the same thing.
ETA Jan 2019:
So now, onto this week’s news. As mentioned above, there’s a new powerup that has been causing a stir in the mushroom kingdom gender discourse for months now, I’m talking of course about the super crown.
Long thought to be a gender transformation item, the revelation that it can only be used by Toadette, reveals more details about the nature of the item. It is not a gender or sex change item, it is a species change item. It transforms toads into humans.
This is actually good news for Luigi (Luigiella? Lugiette? Gina? She hasn’t picked a name yet). As many have pointed out, she doesn’t need the super crown to be a girl, she’s already human, the rest is presentation and hormones should she want them.
But what about other Toads, why cannot they wield the crown? Maybe there’s something special about Toadette, but being a fungal person, how different can she be from other Toads? I believe the answer lies indeed in her chosen gender. As far as I know she’s the only playable character in this game who identifies as a female toad. It is untestable whether another toad woman, such as Tayce T. from paper mario would undergo a transformation should she wear a crown.
The Super Crown is a magical item, and magic is as much inside us as it is outside. Princess Toadstool, the eternal regent of the Toad People, is someone nearly every girl in the mushroom kingdom would have grown up looking up to. Whereas Toads who opt for a more male identity might instead look up to Mario, the kingdom’s hero. So the super crown would allow female toads to become their ideal. Who’s to say there isn’t a super cap out there that could turn Toad into Mariotti?
We can only wonder.