Tsitsipas had never won a set in his previous three meetings against claycourt specialist and 11-times French Open champion Nadal, but the Greek drew first blood by saving a break point to hold in the 10th game and take the first set.
An erratic Novak Djokovic suffered a surprise 6-3, 4-6, 6-2 defeat against the 10th-seeded Russian Daniil Medvedev in the Monte Carlo Masters quarter-finals.
"For the first time I play as if I was at home," said 20-year-old Tsitsipas, who reached the semi-finals at the Australian Open last month.
Naomi Osaka is the first woman to win two major championships in a row since Williams picked up four straight in 2014-15 and has clearly marked herself as tennis' new star.
Karolina Pliskova advances to meet Naomi Osaka in the semifinal.
Defending champion Roger Federer, world number two Angelique Kerber and five-time Grand Slam winner Maria Sharapova were all crashed out of the Australian Open.
Russia's Maria Sharapova screamed in delight after converting her third breakpoint in the seventh game of the third set with a scorching forehand to break defending champion Denmark's Caroline Wozniacki and seal victory.
Serena Williams was relentless in her first appearance at Melbourne Park since winning the title in 2017, losing only five points in the opening set on her way to a 6-0, 6-2 win over Tatjana Maria in just 49 minutes.
Gutsy Andy Murray fought to the end before losing an epic farewell match at the hands of Roberto Bautista Agut. But it was business as usual for ruthless Roger Federer and Rafael Nadal, who joined Caroline Wozniacki in round two.
Frenchman Mouratoglou, who has guided Williams to the last 10 of her 23 Grand Slam titles, felt the American great was in “decent shape” when she reached last year’s finals at Wimbledon and the US Open.
Five-times a runner up at Melbourne Park, Andy Murray had surgery on the hip a year ago and has been unable to recover his best form.
Australian Open organisers said Serena Williams was among the entries for the opening Grand Slam of the year as she attempts to equal Margaret Court's record of 24.
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