The 19-year-old, who made 12 Premier League 2 appearances for the Seagulls last season, will look to help the German outfit in their quest to reach the Bundesliga.
Under-23 coach Simon Rusk said, “This is an excellent loan move for Leo and one which comes at the right time for him. I’m sure he’ll learn valuable lessons from a tough season in the Bundesliga 2.
"Leo works extremely hard on the training pitch and his commitment to improve is clear to see, which is always great to see from a player of his age.
"We will closely monitor his progress in Germany, and we are looking forward to seeing how he progresses as he takes on an exciting new challenge."
Aside from his game time with Albion’s under-23s, Ostigard was also included on the bench for last season’s Emirates FA Cup fifth-round tie against Derby County at the Amex Stadium.
The central defender found the back of the net twice in a PL2 victory over West Ham United last December, before captaining Norway at this summer’s Under-20 World Cup in Poland.
After matches against Uruguay and New Zealand, Ostigard scored in a record-breaking 12-0 victory for his nation over Honduras.