Striker Defoe opened the scoring with a sixth minute penalty after Milan Baros' cross had bounced on to David Murphy's left arm.
Defoe wrestled the ball from Sulley Muntari, who was the spot-kick hero in Saturday's shock quarter-final win at Manchester United, before calmly picking out the bottom right-hand corner.
Rejuvenated Defoe doubled Portsmouth's early lead with a two yard tap-in after Maik Taylor could only parry Muntari's long-range rocket into the path of Baros, who unselfishly crossed to his strike partner.
Birmingham cut short the home celebrations when midfielder Fabrice Muamba gave them a route back into the match less than a minute later.
Muamba found himself unmarked inside the penalty area to side-foot Gary McSheffrey's pass beyond David James.
Papa Bouba Diop came close to extending Pompey's lead in the 16th minute when his long-range effort was tipped wide by Taylor.
Taylor had to be on his mettle again 12 minutes before half-time to keep out Muntari's bending free-kick.
Sebastian Larsson showed Muntari how it was done six minutes later when the Swede drew Birmingham level with a stunning left-foot free-kick from 25 yards.
Portsmouth were back in front in the 49th minute when Hermann Hreidarsson took advantage of some slack Birmingham defending to scoop the ball home at Taylor's near post after Niko Kranjcar's free-kick had only been half cleared.
Birmingham, battling for Premier League survival, had Portsmouth on the back foot for most of the last half hour, but could not find a way past the formidable James.
James produced an acrobatic save to keep out Cameron Jerome's close-range volley 14 minutes from time.
The visitors were hit with a sucker punch two minutes into stoppage time when substitute Nwankwo Kanu made it 4-2 with a diving header from Pedro Mendes' cross.