The 21-year-old shot-stopper was part of Liverpool's victorious FA Youth Cup side in 2007 after joining from Brondby the season before.
He recently travelled to Asia with the Reds as part of their pre-season tour and will now join the Bantams for an initial month.
Jackson was delighed to land the 21-year-old with the possibility of the loan being extended beyond the initial month.
"Martin will be joining us on a month's loan with a view to extending the deal if all goes well," Jackson told the club's official website.
"I'd like to thank Liverpool for their help in making this deal happen.
"It's a position (goalkeeper) that I have been looking at since the start of pre-season.
"I am delighted that Liverpool has agreed to let Martin come here and that Martin has agreed to work with us.
"Martin comes here with a good pedigree and I am sure he will be a great success."