Derbyshire, who left Ewood Park for Greek side Olympiacos last year, joined Birmingham this week on a season-long loan and is now in line to make his Blues debut against Blackburn when the two teams meet at St Andrews on Saturday.
Allardyce did not expect to see Derbyshire return to the Barclays Premier League so soon, but is well aware of the 24-year-old's ability and the problems he could cause for his old club.
"I don't know why he is back, he told me that the place he wanted to be is Greece," Allardyce said. "He said he didn't want to stay in this country, it's that good there he wanted to be there, so I don't quite know what has happened along the line. Obviously it's not quite as good as he thought it was.
"But he is a very good goalscorer, we all know that, and that is why we got an unbelievably good fee.
"We let him go there on loan and he became a hero, they paid a lot of money for him and we capitalised on that because we needed to.
"He was part of the healing process for Blackburn's financial difficulties. Over four million euros was one of the best deals, for him and for us, that I've done in my time.
"Now he comes back, hopefully not to haunt us on Saturday, because we know that, particularly off the bench, he is good at turning a game with goals."
Allardyce might wonder if he could have snapped the player up himself given Blackburn's current lack of striking options.
With the manager inviting offers for Jason Roberts, Rovers could be left with only Nikola Kalinic and on-loan Manchester United youngster Mame Biram Diouf to play up front if they do not find another forward before the end of the transfer window.
The club are in negotiations with Indian businessman Ahsan Ali Syed about a prospective £300million takeover which would vastly increase their transfer budget, but Allardyce has already confirmed that he does not expect the deal to be finalised before the deadline on August 31.
Blackburn began the season with a 1-0 victory over Everton at Ewood Park and although Allardyce was largely pleased with the performance, he feels it highlighted the squad's need for a clinical finisher.
"It was one of the smoothest performances I've seen on the opening day for a long time and I think the performance warranted the victory," Allardyce said.
"But the chances warranted more goals and the old Achilles heel has shown itself in the very first game.
"The chances we created meant we should have won the game by more than one.
"That is our problem and that is what we are trying to resolve and why we are trying to find somebody who will convert more of those chances than the rest of this squad does."
Former Manchester City striker Benjani Mwaruwari has been training with Rovers with a view to securing a contract, someone Allardyce feels could be a "good signing" for the club if he can prove his fitness.