British number one Cameron Norrie was beaten by Albert Ramos-Vinolas in the Monte Carlo Masters second round.
Norrie forced a deciding set before Spain's Ramos-Vinolas, who was hampered by an abdominal injury, came through 6-4 2-6 6-4.
World number 37 Ramos-Vinolas has won all four of his matches on clay against the 10th-ranked Norrie.
Compatriot Dan Evans lost his second-round match 7-6 (7-3) 6-2 to Belgian David Goffin.
British number two Evans, who reached the semi-finals of the event last year, cut a frustrated figure in the closing stages of his match.
He saved seven of 10 break points, but was unable to make inroads on Goffin's serve.
World number three Alexander Zverev, the highest-ranked player remaining in the tournament and seeded second, reached the last 16 with a 6-1 7-5 victory over Federico Delbonis.
Earlier, Miami Open champion Carlos Alcaraz was upset by Sebastian Korda in a match that lasted just over three hours.
Spain's Alcaraz, widely tipped as one of the sport's future stars, was beaten 7-6 (7-2) 6-7 (5-7) 6-3 by the American.
Alcaraz led by a break in the deciding set but the 21-year-old Korda fought back, reeling off three games in a row to close out victory.
Canadian world number nine Felix-Auger Aliassime was beaten 6-2 7-6 (7-2) by Italy's Lorenzo Musetti.
Meanwhile, Malaga has been named as the host of the knockout stages for the next two editions of the Davis Cup Finals.
The International Tennis Federation and its tournament partner Kosmos had initially wanted to stage them in Abu Dhabi, but were unable to finalise a deal.
Four cities, including Glasgow, will host the group stages in September, with the Finals in Malaga at the end of November.