Former world number one Naomi Osaka is set to plummet below 80th in the rankings after her Australian Open title defence met a shuddering halt in only the third round.

The four-time Grand Slam champion from Japan is currently ranked 14th -- already low by her standards -- but is set to fall after her early demise in Melbourne.

Osaka squandered two match points on Friday as 60th-ranked American Amanda Anisimova stunned her 4-6, 6-3, 7-6 (10/5) to set up a showdown with top seed and home hope Ashleigh Barty in the last 16.

The 24-year-old Osaka said that she was "not quite worried" about her tumble down the rankings -- the last time she was below 80 was in August 2016.

"I think that it will go up to where it needs to go up to if I keep playing like this throughout the year," said Osaka, who was happy with her performance despite losing.

"I'm just going to keep my head down and keep working hard. I think I'll get to where I need to get to."

It compounds a difficult six months for Osaka.

She beat American Jennifer Brady in last year's Melbourne Park final but then withdrew from the French Open -- having said she would not do press conferences to protect her mental health -- and did not play at Wimbledon.

She made a tearful early exit at the US Open in September and took an indefinite break from tennis, saying she had struggled with depression.

Osaka returned to action in Australia at the start of this year with a new outlook, saying she was determined to have more fun on court in 2022.

She denied lack of playing time had contributed to her loss to Anisimova, but revealed her coach Wim Fissette thought otherwise.

"Wim said it probably did because I didn't play a person that served and returned really well (until facing Anisimova).

"So he said if I played people that returned as well as she did before maybe I would have been more prepared, but those are the choices that I made."

Osaka was non-committal about what the new few months will hold.

"Honestly, I'm not so sure right now, I'm kind of just settling in what just happened," she said.

"But I guess I'll just think about it a lot and try to understand my body more because I feel when I suddenly play a lot of matches I kind of get a little niggle (injury) here and there, which I'd love to prevent.

"I'm not sure if it's something I have to do more during practice and training or if I just have to play more matches."