Deaman, who joined Birmingham in the summer of 2011, has yet to make a first-team appearance and is seen as one for the future at St Andrew's.
The 19-year-old centre-back, who can also play at right-back, has been a regular in the Birmingham Under-21 side this season.
A number of League One and League Two clubs have expressed an interest in taking Deaman on loan, but Cheltenham are set to win the race for his services.
Chelteham chief Mark Yates is keen to bolster his squad before Thursday's loan deadline as he looks to maintain their push for promotion from League Two.
Birmingham boss Lee Clark is happy to loan Deaman out so that he can get some valuable first-team experience under his belt.