Forest already have Michael Chopra, Alan Rogers, Andy Impey and Michael Stewart on loan deals but Barmby would give Joe Kinnear more options in The Reds' limited midfield.
Barmby has been involved in transfer deals totalling £19m at clubs such as Liverpool, Everton, Middlesbrough and Tottenham.
He has only played three games for Leeds this season and was a member of England's squad that crushed Germany 5-1 in Munich in September 2001.