The American was due to remain at the Memorial Stadium until January 11, potentially taking in the forthcoming FA Cup third-round clash between the two sides, but Blues boss Lee Clark has activated a recall clause.
It comes as City defender Mitch Hancox is struggling with a knee injury sustained against Middlesbrough at the weekend, while Paul Robinson and Dan Burn are each two bookings away from serving suspensions heading into the hectic festive period.
Clark also took the decision to recall fellow defender Amari'i Bell from his loan spell at non-league Nuneaton earlier this week.
Packwood has proved an impressive addition to Rovers' ranks since joining the Sky Bet League Two club in mid-October, making eight starts as he looked to build up his match fitness having recovered from a double leg fracture.
The 20-year-old is in the frame for Birmingham's trip to Bournemouth this Saturday.