SHANGHAI - Britain's Andy Murray became overwhelming favourite for an Asian hat-trick as main rival Rafa Nadal was beaten in the third round of the Shanghai Masters on Thursday.

Top seed Nadal fell 7-6 6-3 by Germany's Florian Mayer leaving Murray the stand-out name in the quarter-finals after the in-form Scot completed a 6-4 3-6 6-3 victory over Swiss Stanislas Wawrinka at the Qi Zhong Tennis Centre.

Murray beat Nadal in the Tokyo final last week to follow-up his title in Bangkok and the two had been expected to have a re-match in Shanghai in the absence of world number one Novak Djokovic and Swiss maestro Roger Federer.

Nadal found himself up against an inspired Mayer who clinched an absorbing opening set tiebreak with an ace.

Spaniard Nadal had some chances to break early in the second set but Mayer, ranked 23, held firm and broke Nadal's serve at 3-3 before repeating the trick two games later to complete one of the best wins of his career.

"Today is a disappointing day. I felt that I did everything right," a visibly crestfallen Nadal told reporters.

"For me the mistake, the really big mistake, was in the second game of the second set. When the opponent is playing well, you have to convert these opportunities.

"So that's sport. He did better than me. I am out. He is going to play tomorrow. That's all."

Nadal's compatriot David Ferrer had a more satisfying day as he survived three match points against another Spaniard, Juan Carlos Ferrero, to reach the quarter-finals and seal his place in the season-ending ATP World Tour Finals in London.

Ferrer will face American Andy Roddick in the last eight after he beat Spain's Nicolas Almagro 6-3 6-4.

In another shock, 124th-ranked Australian qualifier Matthew Ebden knocked out Gilles Simon 6-2 2-6 7-6 -- his reward being a quarter-final clash against Murray.

Murray marched through the first set against Wawrinka but went off the boil in the second as errors began to flow.

However, he took charge in the decider to forge into a 5-0 lead before the 19th ranked Wawrinka staged a late fightback.

Murray, unbeaten since losing to Nadal in the US Open semi-finals, ended the contest with a forehand winner.

"I got myself pumped up right at the beginning of the third set," Murray told reporters. "Stan was playing very well. I was trying to control the ball.

"I was really struggling in middle of the second set. I really had to make sure I got my feet moving."

Japan's Kei Nishikori continued his impressive run, reaching the quarter-finals with a 7-6 4-6 6-3 defeat of Colombia's Santiago Giraldo.

Asia's top-ranked male player will play Ukraine's Alexandr Dolgopolov for a place in the semi-finals.