The visitors began brightly in the East Midlands, with Gary Gardner curling a free kick just past Forest's left post on 17 minutes.
Forest were booed off at the break following a lacklustre first-half display, and things continued in a similar vein after the restart as they failed to register a shot on target by the hour mark.
In the 72nd minute, the Reds appeared to be on the verge of defeat after Che Adams collected the ball on the edge of the box before turning and smashing a low shot into the corner of the net.
With just three minutes left in the game, Forest then struck the equaliser through Daryl Murphy, who poked home on the rebound after Lolley's fierce 30-yard shot was kept out by the Brum keeper.
The result means that Forest remain unbeaten, while Birmingham are still searching for their first win of the season.
NOTTINGHAM FOREST (4-2-3-1): Pantilimon; Byram (Lolley 75'), Figueiredo, Fox, Robinson; Watson (Osborn 67'), Colback; Cash, Soudani (Carvalho 56'), Dias; Murphy
BIRMINGHAM CITY (4-4-2): Camp; Colin, Morrison, Dean, Pedersen; Jota (Mahoney 85'), Gardner, Kieftenbeld, Maghoma (Solomon-Otabor 74'); Jutkiewicz, Bogle (Adams 67')