Wang shot to prominence at the tournament after beating tennis legend Serena Williams in round three, reports Xinhua news agency.
"I did a really good job in the third round, but today the performance was not so good," Wang said.
Wang praised Jabeur's powerful style and conceded that on the day she was out-played. "The beginning of the first set she played not so well but after that she played more aggressive and I played too passively today," Wang said.
In a nervous start to the match, Wang dropped her first serve, but quickly struck back, comfortably taking Jabeur's serve in return. Settling into her rhythm, Wang hammered shots from the back of the court and appeared like she was primed for an easy run into the quarterfinals.
However, Jabeur's slices emerged as a challenge for Wang and the Tunisian also found the back of the court, starting to fire powerful winners. Despite a shaky start, Jabeur claimed the first set in a tiebreak, placing the pressure firmly back on the Chinese player's side of the net.
Once again, Wang stumbled early, dropping her first serve in the second set and quickly facing an insurmountable 0-4 deficit. The air appeared to have left the Chinese player's sails and a series of unforced errors which saw the ball sailing over the baseline, or into the net, didn't help her frustration.
"She made me uncomfortable with slices and drop shots. She has many different shots and I think today she defended very well and she played aggressive tennis," Wang said.
Meanwhile, teen sensation American Cori Gauff's astonishing run at the Australian Open also ended in round 4, slowly crumbling against her countrywoman, Sofia Kenin, 6-7 (5), 6-3, 6-0.
Kenin and Jabeur will now face off in the quarterfinals on Tuesday.
( With inputs from IANS )