Emma Raducanu failed to overcome a painful hand injury as Danka Kovinic condemned the US Open champion to a second round exit.
Having won her Australian Open debut against Sloane Stephens on Tuesday, Raducanu was troubled throughout her match with the Montenegrin, taking several breaks to attend to strapping on her right hand.
The apparent blisters proved a challenge throughout with Raducanu ailed particularly on serve, and Kovinic capitalised to survive a gruelling encounter, securing a 6-4 4-6 6-3 win.
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The 27-year-old is through to the third round of a major for the first time in her career, felling the most recent Grand Slam winner and seventeenth with a canny performance despite making regular errors of her own.
She could face Simona Halep in the third round with the Romanian due to take on Beatriz Haddad Maia later on Thursday on Rod Laver Arena.

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Just as in her opening match in Melbourne against Stephens, Raducanu started the encounter with Kovinic superbly, unfurling a fine array of opening ground strokes to race into a 3-0 advantage.
But her Montenegrin opponent fought back, drawing level with successive breaks as a bothersome hand injury forced Raducanu to take a medical timeout to reapply strapping.
A fourth game in a row went the way of Kovinic, and she set up a chance to serve for the set after breaking for a third time as Raducanu's high lifted shot floated wide.
The British teenager had to respond, and did. Manipulating Kovinic well with particular usage of the front-court, Raducanu broke back, celebrating with a clinch of her left fist.
But the blistering on the opposite hand continued to cause problems for Raducanu on serve. With Kovinic able to sit on a serve not quite at top tilt, Raducanu ceded the first set as Kovinic broke to love after the 19-year-old fired a backhand into the net.
It left the US Open champion needing to come from behind to win at a Grand Slam for the first time in her young career, and she began well, breaking in the opening game of the second set and visibly pumped to then secure a much-needed hold.

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After another medical timeout to attend to her blisters, Raducanu had the chance to break again at 2-4, but let a break point slip.
It proved costly as Kovinic secured a battling hold and then broke herself, with the teenager was by now using slice forehands extensively in an apparent attempt to protect the injury.
Yet a resilient Raducanu was far from finished. She took the second of two break points to move within a game of levelling proceedings, and took the match to a deciding set with a hard-fought final hold.
It meant, after winning her maiden Grand Slam in New York without the need for a single decider, Raducanu would have to contend with a second successive three-setter.
It progressed on serve to 2-1 before the players traded breaks - the 11th and 12th of an extraordinary match.
The 13th soon followed, Raducanu the unlucky party as Kovinic again pounced on the indisposed serve.
And having moved within sight of victory with a hold, the Montenegrin secured victory in just under three hours, saluting the crowd after a career-best Grand Slam performance.

'Another movie!' - Raducanu breaks in brilliant style

"It was amazing, I really enjoyed it," said Kovinic. "It was a nice experience to play against Emma here and make my first Grand Slam third round after so many years [of playing].
"My first round was really tough and it was just regular preparation, as it is for every match. She had an amazing result, winning a Grand Slam at such a young age, she is such a talent - it was a really nice experience and I am glad that I showed I can play at a high level. Hopefully it can continue.
"To be honest I was a little bit low on energy through the third set. I really wanted to be focused on myself and not show too many emotions."
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