Vaz Te struck the winning goal for Bolton on 65 minutes
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Bolton were denied a shot at European entry via the Intertoto Cup when Newcastle beat them to a seventh-place finish in the Premiership.
Ricardo Vaz Te's close-range strike saw them on course to grab the prized position, until Newcastle secured victory over Chelsea to seal the berth.
Kevin Davies nearly doubled Bolton's lead but dragged his shot wide.
Relegated Birmingham's best chance saw DJ Campbell fire into the legs of Bolton goalkeeper Jussi Jaaskelainen.
Bolton's ambitions of landing a Champions League place or Uefa Cup spot had recently tailed off, with a run of just one win in their last nine heading into the final match of the season.
And with Birmingham's poor away record - they have won just twice on their travels this season - the contest ran true to form in the first half as neither side set the game alight.
Bolton did show more urgency early on with their main threat coming down the left-flank where Stelios Giannakopoulos was a dangerous outlet.
The Greek international's whipped crosses were creating problems for Birmingham's back line and it was from one such delivery that the hosts went closest when Davies saw his guided header curl inches past the post.
Birmingham, who had scored only 28 goals in 37 Premiership games heading into the final day, were looking lightweight in attack and missed an opportunity on the half-hour mark.
Campbell (l) made his fourth start for Birmingham against Bolton
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Campbell, making only his fourth start since joining in January, showed quick feet in the box to deceive defender Ben Haim and drill a square-ball across the face of goal.
But Nicky Butt, making his last appearance for Birmingham before he returns to Newcastle, failed to make any contact with the ball.
Despite squandering the chance, Birmingham gradually battled their way into the game and started to string passes together, but lacked the killer ball in the final third.
Just before the break Ivan Campo nearly gave Bolton the lead, but he placed Giannakopoulos' corner just over the bar under pressure from Birmingham full-back Mario Melchoit.
Emile Heskey capitalised on a loose ball after the break to fire wide before Campbell saw his one-on-one effort saved by Jaaskelainen.
At the other end, Maik Taylor was forced into making his first save of the day on 63 minutes when Henrik Pederson fired in from close range.
But his second task was to pick the ball out of the net as second-half substitute Vaz Te came in at the back post for his sixth goal of the season from Kevin Nolan's cross.
From then on there only looked like being one winner as Bolton stepped up their search for a second goal.
Substitute Jay-Jay Okocha flashed a free-kick over and Davies should have made it 2-0 but he dragged his shot wide after being put through by Vaz Te.
Bolton boss Sam Allardyce:
"Newcastle hit a great run when we hit a bad run.
"They pipped us to the post by beating a weakened Chelsea side.
"The season caught up with us in the end, we have played a lot of games but at least we finished with a flourish."
Birmingham manager Steve Bruce:
"We played three upfront today to try something different.
"But you're only as good as your strikers. That is why they cost so much and all season we've been lacking in that position.
"If you can't score a goal you can't win matches."
Bolton: Jaaskelainen, O'Brien, Faye, Ben Haim, Pedersen, Nakata (Okocha 53), Campo (Vaz Te 54), Speed, Giannakopoulos (Borgetti 86), Nolan, Davies.
Subs Not Used: Al Habsi, Jaidi.
Goals: Vaz Te 65.
Birmingham: Maik Taylor, Melchiot, Martin Taylor, Bruce, Sadler, Johnson, Butt, Nafti (Kilkenny 71), Pennant, Heskey, Campbell.
Subs Not Used: Vaesen, Latka, Clemence, Painter.
Booked: Martin Taylor.
Att: 26,275
Ref: S Bennett (Kent).