Horizontal well cavern completion and stress release is considered a potential technique for efficient development of coalbed methane in tectonically deformed coal (TDC). Pulsating loading and unloading is a key technique for the controlled expansion of caverns and broader stress release within the reservoir. However, current understanding of the mechanical characteristics and pore network structure evolution of TDC under cyclic loading and unloading conditions is still limited. This paper employs numerical simulation methods to study the mechanical behavior and damage characteristics of TDC under cyclic loading and unloading. After obtaining a set of micromechanical parameters reflecting the behavior of TDC samples under triaxial compression in high-stress states, the effects of different stress gradients and cyclic amplitudes on the stress–strain curve, porosity changes, and crack propagation in TDC samples were analyzed. The study results indicate that under various cyclic loading and unloading conditions, the mechanical response characteristics of TDC samples are broadly similar, primarily divided into compression, slow expansion, and accelerated expansion phases. Under low unloading level conditions, the volume expansion of TDC samples is minimal. Also, at the same unloading level, the strain increment decreases with an increasing number of cycles. Correspondingly, under these conditions, the porosity and microcrack expansion in TDC are less than in high-stress gradient scenarios. Under the same unloading level but different amplitudes, the volume expansion rate at 50% unloading amplitude is higher than at 1 MPa unloading amplitude for TDC, with an increased number of crack expansions. Therefore, under cyclic loading conditions, the sensitivity of crack propagation within TDC samples to amplitude is greater than that to unloading level. Under actual pulsating excitation conditions, a low-amplitude, low-stress gradient pulsation method should be used to maintain the stability of horizontal well caverns, and gradually increase the cyclic amplitude to achieve the efficient extraction of coalbed methane in TDC reservoirs. The findings of this study can serve as an important reference for optimizing process parameters in cyclic pulsating stress release engineering for TDC.