The Olympic champion was beaten 6-2, 6-7, 6-1 to leave the $2 million Tokyo event shorn of its top three seeds and she was quickly joined at the checkout counter by fourth seeded Dane Caroline Wozniacki, who retired with a viral infection.
Former world number one Maria Sharapova had no such problems, however, powering into the last 16 in Tokyo with an almost flawless 6-0, 6-1 victory over Australia's Samantha Stosur.
Current number one Dinara Safina, second seed Venus Williams and French Open champion Svetlana Kuznetsova all lost their opening matches on Monday after first-round byes.
A tournament which began with nine of the world's top 10 was down to just two before the close of play on Tuesday.
Dementieva blamed some questionable line calls and fatigue for her loss to a player she had not conceded a set to in four previous meetings.
"There were way too many bad calls from the chair umpire today," she grumbled to reporters. "I'm surprised they don't have a challenge system at such a big event."
Dementieva, a second-round loser at the US Open earlier this month, added: "I played way too many matches in the US Open series. I just didn't have the energy."
Sharapova, 25th in the world rankings following shoulder surgery a year ago, answered the prayers of tournament organisers by overpowering 12th seed Stosur in just 57 minutes.
Stosur at least avoided the dreaded "double bagel" by saving two match points at 0-5 in the second set but the Russian wrapped up a clinical victory with an ace two minutes later.
"I just want to finish the year on a good note," Sharapova said. "I served smart. It was definitely a good day at the office all around."
Sharapova next faces countrywoman Alisa Kleybanova, who knocked out sixth seed Vera Zvonareva 3-6, 6-4, 6-2 in another Russian clash.
Beaten US Open finalist Wozniacki walked off court in obvious discomfort after losing the first five games of her match against Canada's Aleksandra Wozniak.
Somdev crashes out
Somdev Devvarman could not make the most of his wild card at the Thailand Open in Bangkok as he went down fighting against Latvian Ernests Gulbis 6-7(7), 2-6 in the opening round of the USD 608,500 hard court event.
Somdev had plenty of chances in the first set but could convert only one of the four breakpoints. The second set saw him drop his serve twice while his opponent saved a breakpoint to deny the Indian the chance of a comeback. Russian Marat Safin reached the second round with a 6-2, 3-6, 6-1 win over fifth-seeded German Philipp Petzschner.
The former world number one, who will retire at the end of what has so far been a disappointing season, took his record to 11-16 by overwhelming the German with a slick final set performance.
Sixth-seeded Austrian Juergen Melzer also advanced after a comfortable 6-3, 6-2 win over Brazilian Marcos Daniel, which took just under an hour.
He will face Turkish qualifier Marsel Ilhan, who saw off 2007 Thailand Open finalist Benjamin Becker 4-6, 7-6, 6-3.
Russian Evgeny Korolev and seventh seed Fabrice Santoro of France battled it out for almost three hours, with the Russian saving two match points in a tense third set to go through 4-6, 7-6, 7-6.
Top seed and defending champion Jo-Wilfried Tsonga of France begins his campaign on Wednesday in a second-round match against Gulbis.
Third seed Sam Querrey of the United States had to withdraw from the competition after sustaining a freak injury when he stumbled onto a glass table which required emergency surgery on a badly cut forearm.
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