Defending champion and top seed Elina Svitolina of Ukraine suffered an upset to Belarus' Aliaksandra Sasnovich to exit the Brisbane International.
The two met in last year's final at the Women's Tennis Association Premier tournament, but this time it was Sasnovich who was victorious, defeating the defending champion 6-4, 0-6, 6-3 at the Pat Rafter Arena.
"Today was a really tough match," Sasnovich said.
"It was a good first set from my side, not so good from my side second set, so I'm lucky to win I think."
Sasnovich will now meet Croatian Donna Vekic in the quarter-finals.
Vekic progressed after battling against Kiki Bertens of The Netherlands to win 7-6, 1-6, 7-5.
Estonia's Anett Kontaveit caused another upset, beating Czech Petra Kvitova 7-5, 7-6.
She will now face Lesia Tsurenko of Ukraine, who eased past Kimberly Birrell yesterday.
In the men's competition, Britain's double Olympic champion Andy Murray exited the tournament to Russia's Daniil Medvedev, losing 7-5, 6-2.
Defending champion Nick Kyrgios of Australia also left the competition, with France's Jeremy Chardy defeating him 6-7, 6-2, 6-3.
Elsewhere in Australia, the mixed-gender Hopman Cup continued in Perth at the RAC Arena.
Germany beat France 2-1 in Group A, with Angelique Kerber beating Alize Cornet 5-7, 6-2, 6-4 and Alexander Zverev overcoming Lucas Pouille 6-3, 6-7, 6-2.
The German pair then lost the doubles match 4-3, 4-3 but had already sealed the overall victory.
Australia then defeated Spain 2-1, also in Group A.
Ash Barty eased past Spain's Garbine Muguruza 6-3, 6-4 but her compatriot Matt Ebden lost to David Ferrer 7-6, 7-5.
In the deciding doubles match, Australia were the stronger team, beating Spain 3-4, 4-3, 4-3.
Both winning teams today have now won twice and will face each other on Friday (January 4) to see who wins the group and reaches the final.
Tomorrow will see the United States try to get their first win of the competition against Britain in Group B, before Greece take on Switzerland.
The Swiss will reach the final with a 100 per cent record should they come out on top.