But it was a successful night for Britain with Laura Robson and Johanna Konta beating Chinese opposition to make it through to the last eight.
Sixth-seeded Hsieh lost her second-round match against China's Zhang Shuai 6-2, 6-2 in little over one hour 15 minutes.
Hsieh's disappointing exit follows a golden year for the world number 42, who was crowned women's doubles Wimbledon champion earlier this year.
She remains in the doubles competition in Guangzhou, where she is the top seed with her partner, China's Peng Shuai.
Peng will also play no further part in the singles competition after the fourth seed was well beaten by British number three Konta, who claimed a 6-1, 6-3 victory.
Third-seeded Robson booked her place in the quarters with a hard-fought 6-3, 7-6 (7/4) victory over China's Zheng Saisai.
France's Alize Cornet beat Karolina Pliskova of the Czech Republic in her second-round match after an early scare.
The number two seed was taken to a tie-break in the first set, but won it 7/4 before dominating the second set and taking it to love.
Cornet will play Yvonne Meusburger next following the Austrian's 2-6, 6-2, 6-4 victory over Serbia's Vesna Dolonc.
Also through to the quarter-finals are China's Zheng Jie, who claimed victory over Hungary's Timea Babos 7-5, 7-6 (7/1), and Vania King of the US, who won her clash with Serbia's Bojana Jovanovski 6-4, 0-6, 6-4.
Eighth seed Monica Puig overcame Galina Voskoboeva of Kazakhstan 6-3, 6-2.
Results from the second round of the Guangzhou Open in China on Wednesday (x denotes seedings):
Vania King (USA) bt Bojana Jovanovski (SRB) 6-4, 0-6, 6-4
Monica Puig (PUR x8) bt Galina Voskoboeva (KAZ) 6-3, 6-2
Zhang Shuai (CHN) bt Hsieh Su-Wei (TPE x6) 6-2, 6-2
Alize Cornet (FRA x2) bt Karolina Pliskova (CZE) 7-6 (7/4), 6-0
Yvonne Meusburger (AUT) bt Vesna Dolonc (SRB) 2-6, 6-2, 6-4
Zheng Jie (CHN) bt Timea Babos (HUN) 7-5 7-6 (7/1)
Johanna Konta (GBR) bt Peng Shuai (CHN) 6-1, 6-3
Laura Robson (GBR x3) bt Zheng Saisai (CHN) 6-3, 7-6 (7/4)