The main goal of this paper is to use the theory of exterior differential forms in deriving variations of the deformed Willmore energy in space forms and study the minimizers of the deformed Willmore energy in space forms. We derive both first and second order variations of deformed Willmore energy in space forms explicitly using moving frame method. We prove that the second order variation of deformed Willmore energy depends on the intrinsic Laplace Beltrami operator, the sectional curvature and some special operators along with mean and Gauss curvatures of the surface embedded in space forms, while the first order variation depends on the extrinsic Laplace Beltrami operator.