Henin had not lost a match since Wimbledon 2007 -- a run of 32 matches -- but was brought to her knees under the night sky by a rampant Maria Sharapova 6-4, 6-0. It was the first time the Belgian had lost a set 6-0 since 2002.
"It's funny because I felt like I was in my own bubble today," the statuesque Sharapova beamed.
"It's amazing when you go out on the court and feel you're doing the right things to beat such an amazing player as her. It's just incredible."
American powerhouse Serena had earlier relinquished her title with little more than a whimper when she was jettisoned 6-3, 6-4 by Serbia's "wounded animal" Jelena Jankovic. "I had some issues but I don't like to make excuses," Serena said. "Definitely a problem all through the day, but nothing life-threatening, so it's fine...
Her misery was compounded when she lost in the women's doubles paired with sister Venus.
In the men's draw, Rafael Nadal continued his assault on the first Grand Slam of the season with a muscular win over Finn Jarkko Nieminen.
He next meets unseeded Frenchman Jo-Wilfried Tsonga, who upset 14th seed Mikhail Youzhny of Russia 7-5, 6-0, 7-6 to reach his first Grand Slam semifinal.
With Serena already defeated, Henin took to the court a strong favourite to win the title she bagged in 2004.
Her fifth-seeded foe was in ebullient mood, however, smashing 30 winners as she took a tight first set and ripped through the second to line up a semifinal against Jankovic. Runner-up to Serena in Melbourne last year, Sharapova had lost six of her eight meetings with Henin but the results record counted for nothing.
Herself a former world number one, Sharapova ran amok and left Henin wondering what might have been. "I think that I have no excuse. You know, she won the match. She's been the best," Henin said.
Serena falls
Three-times Australian Open champion Serena was out-fought and out-thought on Rod Laver Arena, beaten 6-3, 6-4 to leave her title defence in tatters.
Soon afterwards she, along with sister Venus, was out of the women's doubles too following a 6-3, 4-6, 2-6 quarterfinal defeat by China's Yan Zi and Zheng Jie.
For Jankovic, who is recovering from surgery and plagued by niggling injuries, the 99-minute victory was sweet revenge for last year's fourth-round defeat at Melbourne Park.
Serena is known to be one of the most fearsome fighters in sport, but under clear blue skies she was impotent. Her shots lacked punch, her serve lacked bite and her tactics unravelled.
Spanish powerhouse Nadal simply wore down Nieminen for his 7-5, 6-3, 6-1 victory and a place in the Australian Open semifinals for the first time.
The three-times French Open champion saved two set points before winning the first set and gradually turned the screw.
"It's the third match that I have had set points against me in the first set so I'm very happy about (coming through) that," Nadal said.
Results (quarterfinals):
Men’s singles: Jo-Wilfried Tsonga (France) bt 14-Mikhail Youzhny (Russia) 7-5, 6-0, 7-6 (8-6); 2-Rafael Nadal (Spain) bt 24-Jarkko Nieminen (Finland) 7-5, 6-3, 6-1.
Women’s singles: 5-Maria Sharapova (Russia) bt 1-Justine Henin (Belgium) 6-4, 6-0; 3-Jelena Jankovic (Serbia) bt 7-Serena Williams (US) 6-3, 6-4.