
The Spaniard who holds a Roland Garros title and briefly stood world number one, claimed his third consecutive victory over the tenth seed.
"I'm playing good tennis since two months," said Ferrero, losing finalist a week ago at Auckland. "I practised so hard in December. Last week I played good. The final (which he lost to German Philip Kohlschreiber) gave me a lot of confidence to came here and try to play at the same level."
Ferrero fired a dozen aces and 32 winner as he beat the burly Nalbandian, who came to the Grand Slam with no preparation after tweaking his back last week.
The Spaniard will next face compatriot and fifth seed David Ferrer, a winner over veteran American Vince Spadea 6-3, 6-3, 6-2.
After Saturday's rain which prevented play on outside courts at Melbourne park, women also began getting third-round matches caught up.
Ninth seed Daniela Hantuchova was the fist woman through on the day, defeating Spain's Virginia Ruano Pascual 6-2, 6-3.
Russian 14th seed Nadia Petrova out out countrywoman Ekaterina Makarova 6-1, 7-6 (10-8) while Poland's Marta Domachowska, who trains at Ferrero's academy in Spain,reached the fourth round over China's Li Na 2-6, 6-2, 6-4.