The 19-year-old academy graduate, who recently agreed a new contract at Elland Road, has made seven appearances for the Whites this season, scoring one goal.
He is the leading scorer for Leeds' Under-21 side this campaign, having netted six times.
Earlier this season, he spent time on loan with the Blades' League One rivals Bury, where he scored twice in eight matches.
Poleon is looking forward to helping Danny Wilson's side in their bid to earn promotion to the Championship, with the club currently fifth in the table, five points away from the automatic promotion places.
"It's another chance to get some experience and play some first-team football," said Poleon.
"Sheffield United are near the top and I want to help them kick on to promotion."
Wilson admitted he had enquired about Poleon's services in the January transfer window and is pleased to have finally landed his target.
"He is young, raw and unpredictable, but he is quick and offers pace defenders won't like to defend against," he told the club's official website.
"He can offer us a lot both in terms of starting games and also as an impact substitution from the bench. We need that extra striker and if we are to be successful, we need as many strikers available as possible."
To find out more about live football on Sky Sports, click here.