The song has divided opinion with critics and fans, with its YouTube video earning more 'dislikes' than likes'.
The 'Smile' singer tweeted about Lloyd's upcoming release, saying: "I quite like 'Swagger Jagger', well, I like the verses."
Allen had previously backed the X Factor star, after she was criticised by News of the World journalist Dan Wootton on Twitter.
Cher Lloyd has promised fans that her debut album will feature a variety of styles.
Lily Allen is currently writing songs for an upcoming stage musical adaptation of Bridget Jones' Diary.
Watch the video for Cher Lloyd's 'Swagger Jagger' below: