Following his studies of art history and literature in Vienna and Graz, he worked as an assistant at the Department of Art History of the University of Vienna. His specialization was the Biedermeier period, which led naturally to his interest in Schubert, whose life took place during this cultural era. His scholarly career was interrupted by World War I when he served in the Austrian Army. Following the war Deutsch worked for a time as a bookseller. He also shifted his scholarly interests to historical musicology, eventually becoming music librarian, working in the archives of Anthony van Hoboken. In 1938, when Austria was taken over by Nazi Germany in the Anschluss, Deutsch decided to flee the country, as he was a Protestant of Jewish origin. He lived in Cambridge, England, from 1939 to 1951, returning to Vienna after the war.
