The 17-year-old – who is also the youngest participant in the men's draw – beat Oscar Otte 6-2 6-4 6-7 (2-7) 7-5 to advance to the second round on Monday.
Shang will play number 16 seed Frances Tiafoe next, and after his win acknowledged what a big moment it is for men's tennis in China.
"I think it's huge for Chinese men's tennis," he told reporters. "We have had really good players from the women's side but not really big names in the men's, so I think we are very lucky that I'm part of it, and I'm very lucky that I'm part of this team. Hopefully we can do something big in the future."
On why it has taken so long for a man from his country to find success at the tournament, Shang – who also likes to go by the name Jerry – said: "It's a complicated thing. I'm not quite sure how to answer that, but I think physically it's a big step for us in the men's tennis.
"But I think we're on the right track now. Hopefully we can do a better job in the slams, in the three-out-of-five sets, hopefully that can happen in the future."
Shang named Roger Federer, Rafael Nadal and Novak Djokovic as his three main inspirations, citing their passion for tennis and "amazing personalities".
The world number 194 impressed against Otte, hitting 53 winners and not dropping his serve at any point, saving the only two break points he faced while taking nine of 13 break points he forced against his German opponent.
Djokovic had not featured in an ATP-level match since his final victory over Nick Kyrgios at Wimbledon, having been forced to miss the US Open due to his COVID-19 vaccination status.
But the Serbian needed little time to find his feet in Israel, winning the first seven games of the match and breaking the Spaniard's serve four times en route to a 6-0 6-3 victory.
Speaking on court afterwards, Djokovic said: "Fantastic atmosphere here tonight, thank you very much. I like the court, it's very intimate and it's very loud.
"The crowd here is very passionate about the sport, about tennis and I'm really, really happy to be here and to perform here in front of you, so thank you for your support."
The 21-time grand slam winner will face Canada's Vasek Pospisil in the last eight after he beat home hopeful Edan Leshem 6-3 6-2.
Two of Djokovic's fellow seeds fared less well, however, with Diego Schwartzman and Botic van de Zandschulp both being ousted after three-set contests.
Third seed Schwartzman failed to capitalise on a third-set match point in his 6-3 2-6 7-6 (9-7) loss to Arthur Rinderknech, while Britain's Liam Broady teed up a clash with Marin Cilic by beating Van de Zandschulp 6-4 4-6 6-3.
The Sofia Open also saw a couple of seeds fall to surprise defeats on Thursday, although Jannik Sinner avoided any drama in his 6-3 6-4 win over Nuno Borges.
Sinner now has a perfect 10-0 record at the event, which he won in both 2020 and 2021, and will face Australia's Aleksandar Vukic for a place in the final four.
Holger Rune also progressed to the last eight, though he was forced to rally after losing the opener against Lorenzo Sonego, but Pablo Carreno Busta and Oscar Otte were both dumped out.
Second seed Carreno Busta fell to a 6-3 3-6 6-2 reverse against Switzerland's Marc-Andrea Huesler, who will face Poland's Kamil Majchrzak in the quarter-finals after he came back to beat Otte 4-6 6-2 6-4.
The world number one, who reached the final at 's-Hertogenbosch last week only to suffer a shock defeat to Tim van Rijthoven, had not beaten Bautista Agut in three previous matches.
But his duck against the Spaniard is over following a 6-2 6-4 win, which set up a semi-final meeting with Oscar Otte after the German saw off Karen Khachanov in three sets.
"I remember all the matches we had… He was playing some [great] tennis and it was tough for me to win," Medvedev said of his previous meetings with Bautista Agut.
"Today I had my plan, managed to keep it going. Definitely got more edge on the most important points, because he had more break points than me. It was not easy, and I'm happy to win."
Hubert Hurkacz, a Wimbledon semi-finalist last year, is also into the last four after edging Felix Auger-Aliassime in two tie-breaks and will face Nick Kyrgios, who beat Paulo Carreno Busta in straight sets.
Elsewhere, Matteo Berrettini was victorious at the Stuttgart Open and is on course to go back-to-back at the Queen's Club Championships after seeing off Tommy Paul 6-4 6-2 to progress to the semi-finals.
Botic van de Zandschlup is his next opponent, the Dutchman overcoming Alejandro Davidovich Fokina 6-2 6-4.
Meanwhile, Filip Krajinovic had to come from a set down to end Briton Ryan Peniston's run at the quarter-final stage, with his reward a meeting with former US Open champion Marin Cilic, a straight-sets victor over Emil Ruusuvori.
The world number one was forced to save a set point in a tight opener before rallying in a tie-break and sailing through the second set in a 7-6 (7-3) 6-3 win.
Despite falling to a shock defeat to Tim van Rijthoven in 's-Hertogenbosch last week, Medvedev is now 14-2 on grass since a first-round exit at Halle last year, and was delighted to make up for 2021's performance on one of his favoured surfaces.
"I didn't play well in Halle last year, so I'm happy that this year I managed to raise my level," he said after the win.
"As I've always said, I love playing on grass, so I'm happy to show to myself that I'm capable of being in the final of one of the greatest tournaments, especially on grass, and of course I'm looking forward to tomorrow."
Standing between Medvedev and the second grass-court title of his career is Hurkacz, who required two tie-breaks to edge a thrilling contest with Nick Kyrgios, winning 4-6 7-6 (7-2) 7-6 (7-4).
Elsewhere, last year's Wimbledon runner-up Matteo Berrettini remains on course for back-to-back titles at the Queen's Club Championships after a straight-sets win over Botic van de Zandschulp in the final four.
Berrettini overcame a rain stoppage to secure his eighth consecutive victory, securing a 6-4 6-3 win, and delighted after triumphing in challenging conditions.
"It was a really tough match. We stopped for the rain. I had a lot of chances. It was windy again and really tough to play, but I definitely think it was the best match of the week, so I am really happy and looking forward to the final," the Italian said.
Berrettini will face world number 48 Filip Krajinovic in Sunday's final, after the Serb cruised past 2014 US Open champion Marin Cilic 6-3 6-3.
At the Queen's Club Championships, second seed Matteo Berrettini came from a set down to finally see off Denis Kudla, winning 3-6 7-6 (7-5) 6-4.
Defending champion Berrettini was troubled by the world number 82, and was just a tie-break away from suffering an upset, but the Italian came through as he belted down 22 aces in the match.
Berrettini faces Tommy Paul in the quarter-finals after the American beat Stanislas Wawrinka in straight sets, 6-4 6-1.
Ryan Peniston carried on from knocking out number one seed Casper Ruud by beating Francisco Cerundolo 6-0 4-6 6-4, setting up a last eight clash with Filip Krajinovic after he came from behind to defeat Sam Querrey 4-6 6-3 6-4.
Murray, ranked 53rd in the world, could not find his usual return with Lajovic winning 72 per cent of second-serve points, prevailing in one hour and 38 minutes.
The Serbian claimed only his fourth win out of 16 matches on hard courts since the start of last year, holding his nerve after failing to serve out the match at 5-4 in the second set, converting his third match point in the 12th game.
Lajovic hit 21-14 winners, with Murray committing more unforced errors (15-13). The Serbian converted all three break points he generated.
Former world number six Gael Monfils was forced to retire due to a right wrist injury in his clash with French compatriot Ugo Humbert at 3-3.
Monfils, 36, was playing at only his third event since returning to the ATP Tour following seven months out due to injury.
Argentina's Facundo Bagnis defeated Brazilian qualifier Felipe Meligeni Alves 6-3 1-6 6-4, with his reward a second-round clash with last week's Indian Wells Open winner and top seed Carlos Alcaraz.
World number 50 J.J. Wolf beat world number 48 Alexander Bublik 7-5 6-3 in 79 minutes, earning a second-round clash with sixth seed Andrey Rublev.
World number 74 Martin Fucsovics sent down nine aces as he beat Argentina's Pedro Cachin 6-4 7-6 (7-2) in 107 minutes. Fucsovics will next face seventh seed Holger Rune.
Ilya Ivashka beat Daniel Altmaier 6-2 6-1 to book a second-round clash with third seed Casper Ruud, while Fabio Fognini bowed out, losing 6-4 5-7 6-4 to Jan-Lennard Struff. USA's Brandon Nakashima powered to a 7-6 (7-3) 6-3 victory over Germany's Oscar Otte.
The three-time major winner stunned Stefanos Tsitsipas in the previous round – his first win over a top-five opponent in six years – and followed that up with another fine victory.
Murray, who last contested a final on grass when winning Wimbledon for a second time, prevailed 7-6 (7-5) 6-2 against Kyrgios.
He moves up to 47th in the live ATP rankings – the first time he has been in the top 50 since May 2018 – and will face Matteo Berrettini in what will be his 70th career final.
Aiming to keep alive his hopes of a ninth career title on grass, Murray saved both break points faced in the first set and showed good resolve to edge Kyrgios in the tie-break.
The second set was not as tightly contested, with the 35-year-old showing few signs of fatigue as he twice broke Kyrgios' serve to reach Sunday's final in Germany.
Berrettini had earlier defeated Oscar Otte 7-6 (9-7) 7-6 (7-5) to reach his first tour-level final of an injury-hit season.
The world number 10 fired 18 aces en route to overcoming home favourite Otte in a time of one hour and 48 minutes.
"I am really happy," Berrettini said in his on-court interview. "Arriving at the tournament, that was the goal [to reach the final].
"From thinking about it and actually making it is a big difference. I am happy I am here and have another chance to play another final after months without playing.
"This means this is my level and I have proved once again I am comfortable at this level and on this surface. I really like it here at Stuttgart."
Rune – the fifth seed for the tournament in Bulgaria – required two tie-breaks to clinch victory in his first meeting with Van Rijthoven on the ATP Tour, eventually claiming a 7-6 (7-2) 7-6 (8-6) win.
After the match, Rune expressed his relief at avoiding a third set, saying: "I didn't want to go to three sets. If it [had happened], I was going to fight for sure and try to take it in three, but I'm very happy to finish in two."
Meanwhile, eighth seed Oscar Otte beat Dragos Nicolae Madaras 6-3 6-2, and Portugal's Nuno Borges overcame Mirza Basic in three sets to tee up a meeting with defending champion and top seed Jannik Sinner.
In Tel Aviv, seeds Aslan Karatsev and Tallon Griekspoor fell at the first hurdle with three-set reverses to Tomas Martin Etcheverry and Vasek Pospisil, respectively.
Etcheverry rallied after Karatsev took a second-set tie-break in comprehensive fashion to post a 6-2 6-7 (0-7) 6-4 win, while lucky loser Pospisil stunned Griekspoor for a 4-6 7-6 (7-3) 7-5 triumph.
Fifth seed Botic van de Zandschulp fared better, however, dispatching Joao Sousa 6-2 6-3 after producing a top-class display of serving.
The Dutchman will meet Britain's Liam Broady in the next round after he recorded a straight-sets win over Hamad Medjedovic.
Korda had eliminated top seed Felix Auger-Aliassime in the quarter-finals in Portugal to set up an all-American last-four clash, and looked on course to reach the final after winning the first set against Tiafoe.
However, the fifth seed roared back to seal a 4-6 7-6 (7-2) 6-4 victory and set up a final encounter with Argentina's Sebastian Baez, who beat Albert Ramos-Vinolas to reach his second tour-level final.
Baez also needed three sets in his semi-final clash after losing a competitive second-set tie-break, but he then produced a scintillating performance to win the decider without dropping a game, winning 6-3 6-7 (7-9) 6-0.
Elsewhere, Danish 19-year-old Rune sealed his first ATP tour final appearance by beating home favourite Oscar Otte 6-4 6-4 at the BMW Open in Munich.
Rune, who has enjoyed a dream week in Bavaria after sensationally downing Alexander Zverev in the last-16 and failing to drop a single set in the tournament, revealed his ambitions to become world number one in the future after the victory.
"It's a pretty unreal feeling," he said of his semi-final win. "I didn't expect this at all coming into this tournament, and I just took it match by match. Obviously, I had a tough draw, playing Zverev in the second round, but I knew it was going to be tough, so I was ready from the beginning, and I'm super happy to be in the final.
"It's getting better and better, I'm improving every day, and this is what matters. I have some goals to be number one in the world, and you have to start somewhere."
Rune will face eighth seed Botic van de Zandschulp in the final after the Dutchman rallied to beat Miomir Kecmanovic 2-6 7-6 (7-4) 6-4 in his own final-four encounter.
Auger-Aliassime won just 50 per cent of points behind his first serve as Korda claimed an impressive 6-2 6-2 success over the Canadian in one hour and 29 minutes.
In the semi-finals Korda will take on fellow American Frances Tiafoe, who edged out Alejandro Davidovich Fokina 7-6 (7-5) 5-7 7-5 in a tight encounter.
The other last-four clash will see Albert Ramos Vinolas take on Sebastian Baez.
Ramos Vinolas bested Fernando Verdasco 6-2 6-2 to set up his meeting with Baez after the Argentine rallied from a set down to defeat Richard Gasquet 3-6 6-1 6-4.
At the BMW Open, second seed Ruud fell to Botic van de Zandschulp in the quarter-finals.
The Dutchman won their only previous encounter en route to the last eight at last year's US Open and he triumphed 7-5 6-1 in Munich.
"Maybe the score is easier than it really was," said Van de Zandschulp. "The first set [was] really tight, I think. A great battle in the first one. I had some opportunities to break him in the beginning and didn't take them. Gladly [at] five-all I made the break and held the serve at 6-5.
"[The] second set was a little bit easier, but I think I played really well today."
Next up for Van de Zandschulp is Miomir Kecmanovic, who defeated Nikoloz Basilashvili 7-6 (7-5) 6-2. Holger Rune will continue his impressive run against Oscar Otte in the other semi-final after they overcame Emil Ruusuvuori and Alejandro Tabilo respectively.
The second seed managed to triumph in his first match since the French Open final defeat to Carlos Alcaraz, eventually winning 6-7 (5-7) 6-3 6-4.
Zverev has twice reached the show-piece at this event, in 2016 and 2017, though acknowledged challenges remain with adapting from the clay-court surfaces at Roland-Garros.
"A week ago, I was playing on clay still basically," Zverev said in his on-court interview. "He made it very tough for me, no rhythm at all.
"That's how grass-court tennis is sometimes and I'm just happy with the win.
"He did make it extremely difficult for me, so credit to him. I'm obviously happy that I won and hopefully, it's going to be a level above in the next match."
The world number four is now 35-10 for the season and will look to extend that record when he meets Italy's Lorenzo Sonego in the next round.
Zverev has won all three head-to-head meetings with Sonego, and will fancy his chances if he delivers another heavy-hitting performance next time out.
The 27-year-old smashed 54 winners, compared to his 40 unforced errors, to triumph in just over two hours under the OWL Arena roof.
Stefanos Tsitsipas also began his grass season with victory, defeating home hopeful Henri Squire 7-6 (9-7) 7-6 (7-2).
The Greek sixth seed will face Luciano Darderi or Jan-Lennard Struff in the second round.
