Defending Australian Open champion Naomi Osaka squandered two match points as she suffered a shock third-round exit at the hands of unseeded Amanda Anisimova on Friday.

Osaka eased past Camila Osorio and Madison Brengle in straight sets in the first two rounds but fell to a 4-6 6-3 7-6 (10-5) loss to Anisimova in a thrilling contest.

Anisimova, who won her second career title at Melbourne Summer Set 2 earlier this month and is now 8-0 for the season, will face top seed Ash Barty in the last 16.

Two-time Australian Open winner Osaka had won 24 of her past 25 matches in Melbourne and made a fast start against Anisimova by breaking her opponent in the first game.

She held serve to ease ahead on Margaret Court Arena, but Anisimova battled back well in the second set.

The world number 60 broke Osaka in the fourth game with a sublime disguised backhand drop and served out the set in a relatively straightforward manner.

Anisimova continued to dig in and saved two match points in the 10th game to help pave the way for a decisive first-to-10 tie-break.

Osaka had no response to her opponent's accurate hitting as she fell 3-0 behind and, while she did bring it back to 3-2 and 5-4, Anisimova took five of the next six points to advance in a big upset.