Oscar Thorn has joined Sky Bet League Two side Colchester United on a season-long loan.
The agreement includes an option for City to recall the midfielder during the January transfer window.
Thorn, who joined the Imps from the U’s last August, will spend the campaign back in Essex as he continues his development.
Sporting director Jez George said: “Oscar needs football, which we cannot guarantee him at the moment, and this move allows him to play for a club and manager that he knows, and they know him, so that he can get regular games. Last season was frustrating for Oscar in requiring surgery on his ankle, which kept him out for three months, and then returning to full fitness when the team was flying and competition for places was intense.
“Oscar can still have a long-term future at Lincoln City but to give that the best chance he needs an opportunity to play, so this loan makes total sense. We have a recall in January so we can assess his progress and then decide on what is best for Oscar in the second half of the season.
“Oscar came back from the summer really fit and really strong. He’s performed well in training and games but the EFL rule of only permitting a player to register and play for two clubs in a season means that if he was in the squad on Saturday, and came on the pitch, he would then not be able to go to another club on loan in January.
“We want the flexibility to accelerate Oscar’s development by potentially securing him a League One loan in January, which we wouldn't be able to do if he plays any minutes at Derby, so that wouldn't be wise and therefore we have made the decision for Oscar to join Colchester ahead of the weekend.”