Forde has yet to make the breakthrough at Upton Park since signing for The Hammers in a £75,000 deal from Barry Town in January 2002.
The 23-year-old has previously played for Galway United in the Eircom League and his return to Republic of Ireland is expected to boost Derry's early season fortunes.
Derry have lost their opening four games of the campaign and manager Kevin Mahon has already dispensed with the services of Andy Petterson between the posts.
Mahon has, instead, turned to former Welsh Under-21 international Forde to add some solidity to the goalkeeping position.
During his stint at Brandywell, Forde will be eager to impress in order to boost his prospects of forcing his way into the first-team picture at Upton Park upon his return to Glenn Roeder's side.
