Jay Wilson posted the PvP Blog today. It explains the iterations and internal testing of Team Deathmatch Mode. The feature has been deemed not at par with the expected Blizzard-quality standards. Again, the Diablo III Team is scratching Team Deathmatch, and starting anew — back to the drawing board.
Dueling, however, will be available in Patch 1.0.7 sometime during early 2013. There will be a Dueling Blog update before the patch goes live.
Is all lost for Team Deathmatch? There is a possibility it might return at some extent. No promises there. What the Diablo III Team is considering now is to offer Team gameplay with PvE elements and a reward system behind it.
Jay Wilson: Team Deathmatch provided us with the foundation that we needed and served us well. Hell, it may even still be added in some form in the future. For now, though, we’re going to first be looking at new modes that play up to the strengths of the character classes, focus on objectives beyond just defeating other players, and possibly even integrate PvE elements and rewards. — read the PvP Blog