Quote Originally Posted by Smoke'n'Toke
Its something along the lines of:

At first a baby has no sex, it is neither female or male. It DEVELOPS into a sex, developing the features of that sex later on in the process. The nipples develop before the sex features, thus both sexes have nipples.

Thats not PERFECT, but I know it goes something like that.
Something like that. Actually the whole deal is that at some point of early fetal developement we all start as females, then some chromosomes (hey, I'm no expert) become active and decide whether to make us male of female from that point. But yeah, we're all female at the start.