Jessica Pegula crashed out of the Australian Open following a straight-sets defeat by world number 55 Olga Danilovic.

Last season's US Open finalist was beaten 7-6 (7-3) 6-1 by her Serbian opponent, who will play Paula Badosa in the fourth round in Melbourne.

Friday's final match on Rod Laver Arena remained on serve throughout the first set, but Danilovic won the last five points in the tie-break to draw first blood.

The 23-year-old then saved four break points in game three of the second set, before taking control when she broke seventh seed Pegula in the next game.

Another break in the sixth game was followed by a successful hold that sealed Danilovic's place in the second week.

"I'm super happy with the way I played," she said. "I knew I had to play my A, A, A, plus, plus, plus game to beat her. In the back of my mind, I really believed in myself."

Data Debrief: Danilovic matches best major performance

Danilovic, who is yet to drop a set in the opening three rounds, has matched her best performance at a major, having also reached this stage at last year's French Open.

It was her third career top-10 win, with the last coming against Danielle Collins during that groundbreaking run at Roland-Garros.

Danilovic is also the first Serbian woman to reach the second week at the Australian Open since Jelena Jankovic and Ana Ivanovic 11 years ago.