Taufik Hidayat's hopes of retaining his world badminton championship title evaporated on Thursday when he slumped to first ever defeat to China's Chen Hong in a tense third-round contest.

Hidayat, who is also the Olympic [Images] champion, took the first game comfortably but then succumbed to Chen's patient pressure tactics, allowing the world number seven to notch up his maiden win over the Indonesian, 14-21 21-18 21-19.

Chen, who won the All-England Open last year, was delighted with his comeback win but Hidayat hurried past reporters and headed out of the Palacio de Deportes.

"In the first game I had problems with the draft at my end of the court and I was cautious, maybe too cautious," said Chen.

"But I played more intelligently after that. Even though I lost all our previous meetings I wasn't affected by that record. I was under no pressure and I think Taufik was."

Hidayat was unseeded in Madrid after an inconsistent season affected by injury and marred by controversy after he stormed out of the recent Hong Kong Open in a dispute over a changed line call.

There was smooth progress for world number one Lee Chong Wei of Malaysia, second seeded Chinese Lin Dan and Danish world number four Peter Gade.

Lin was in impressive form as he rattled off a 21-16 21-12 win over Park Sung-hwan of South Korea to set up a quarter-final clash against Malaysia's Muhamad Hafiz Hashim who fought back from a game down to beat Dicky Palyama of the Netherlands.

Top seed Lee used his superior court craft to defeat Dane Joachim Persson 21-16 21-12.

Lee, who is looking to add a first world title to the Commonwealth gold he won earlier in the year, pulled away at 16-all in the first game and stepped up a gear in the second to claim victory.

TOP FORM

"I did my homework on him," he said. "I knew he was powerful and fast at the net, so I slowed the game down and played to my strengths.

"I'm still not playing that well, maybe at about 70 percent, but I hope I will be on top form for my next match."

Lee will meet Chinese world number eight Bao Chunlai who took a 21-14 21-19 victory over Indonesia's Sony Dwi Kuncoro in Friday's quarter-finals.

Danish number one Gade will face Chen after notching up an authoritative 21-14 21-13 win over Japan's [Images] Shoji Sato.

"I would have bought that result before the match," said Gade. "He's a very fast player but he took a lot of chances and I controlled the wind well today.

"I felt good, I was ready and I made the right decisions."

In the women's singles, world champion Xie Xingfang of China, seeded joint third in Madrid, overwhelmed Tine Rasmussen 21-14 21-6 and will meet France's [Images] Pi Hongyang in the last eight.

World number one Zhang Ning, the 2003 champion, saw off Wong Mew Choo of Malaysia 21-13 21-13 and will now meet England's [Images] Tracey Hallam.

The Commonwealth Games [Images] gold medallist, Hallam continued her impressive progress at the tournament with a whirlwind 21-12 21-7 victory over Thai Monthila Meemek.

There was victory, too, for Germany's [Images] remaining representatives.

Second seed Xu Huaiwen beat Japan's Eriko Hirose 21-19 21-16 and Petra Overzier scored an upset victory over world number four Wang Chen of Hong Kong with a gritty 22-20 4-21 22-20 win.