Top seed David Nalbandian was upset 6-2 7-5 by his unseeded Argentine Davis Cup team mate Horacio Zeballos in the second round of the Santiago claycourt tournament on Thursday.
Zeballos, ranked 108 and a doubles player on Argentina's Davis Cup team, served strongly and appeared the better concentrated of the two on the big points against the world number 19 in their first meeting.
Zeballos will meet number five seed Potito Starace in the quarter-finals after the Italian beat Spaniard Pablo Andujar 6-4 6-1.
Thursday's other second-round winners were eighth-seeded Colombian Santiago Giraldo, who beat Russian Igor Andreev 7-6 4-6 6-2, and Argentine fourth seed Juan Ignacio Chela, who romped past Brazilian qualifier Caio Zampieri 6-2 6-3.
Giraldo squares up with Chela in Friday's quarter-finals.
Brazilian defending champion Thomaz Bellucci, at number three the highest remaining seed, will meet Italian Fabio Fognini in the last eight after they both won on Wednesday.
Spanish sixth seed Tommy Robredo meets unseeded Argentine Maximo Gonzalez.