Raducanu was playing for the first time since going out of the Miami Open in the first round after defeat against Bianca AndreescuEmma Raducanu's first clay-court match of the season ended in a one-sided defeat by former French Open champion Jelena Ostapenko in Stuttgart.
The British number one struggled to deal with ferocious hitting from the Latvian and lost 6-2 6-1 in 59 minutes.
Having reached the quarter-finals of the event last year, Raducanu's exit means she will drop down the rankings from her current place of 68.
Ostapenko will play Tunisia's third seed Ons Jabeur in the last 16.
Raducanu skipped Great Britain's Billie Jean King Cup defeat to France last week to prepare for the clay-court swing but was completely outplayed after being given a tough opening draw.
The 2021 US Open champion won the first game but was overpowered by her opponent's heavy hitting as she lost the next five on the way to giving up the opening set.
Having held serve at the start of the second, Raducanu moved to 0-30 on the 2017 French Open winner's serve but from there Ostapenko won 16 points in a row to ease into a 4-1 lead.
The 2017 French open champion hit 26 winners to Raducanu's six.
Elsewhere, Spain's world number 31 Paula Badosa thrashed seventh seed Daria Kasatkina 6-1 6-1.
At the Barcelona Open, men's world number two Carlos Alcaraz, who lost the top ranking to Novak Djokovic after going out of the Miami Open in the semi-finals, opened his clay-court campaign with a comfortable 6-3 6-1 win over Portugal's Nuno Borges.
But American fifth seed Frances Tiafoe was beaten 4-6 7-6 (7-3) 4-6 by world number 40 Emil Ruusuvuori of Finland.
Norwegian third seed Casper Ruud, last year's French Open finalist, beat American Ben Shelton 6-2 7-6 (7-1).
