The two-time former champion was beaten in straight sets 7-5 6-4 by debutant Jessica Pegula and Azarenka pointed to her stunted preparation as not an ideal way to get ready for the first grand slam of the season.
The Belarusian was one of 72 players in strict isolation after arriving in the country where she was unable to leave her hotel room for two weeks.
She managed to complete just one match post quarantine, before pulling out of the warm-up event with a lower back injury.
“Was that the best preparation for me? No,” Azarenka told reporters after her defeat. “The biggest impact for me personally has been not being able to have fresh air. That really took a toll.”
“I don’t know how to prepare after two weeks in quarantine. I don’t have a blueprint how to prepare. It’s all about trying to figure it out and I didn’t figure it out. Not this time.”
Despite starting the match well, Azarenka began to falter physically and called two medical timeouts in the second set.
Although she declined to give the reasons for the interventions, it appeared she was struggling with her breathing.
“I am disappointed that I wasn’t able to perform that I knew I could. That’s a bit hard to accept today because I knew I can play better, a lot better,” added Azarenka, who won the Australian Open title in Melbourne in 2012 and 2013.
“At the same time I feel that I’ve tried everything I can to be able to be prepared, but unfortunately that hasn’t worked out for me.”
‘Very, very tough’
Many players were critical of the way they were treated in the strict isolation. None more so than Spain’s Paula Badosa, who spent 21 days in quarantine after testing positive for the virus.
The 23-year-old was beaten 6-7 7-6 7-5 by Russian qualifier Liudmila Samsonova on Tuesday and blamed her isolation period for the result.
“I fought until the last minute. But it wasn’t enough. I think my level wasn’t on my best,” Badosa told reporters. “Of course, it’s been very, very tough. I think my level, it’s not even 70% that I was before.
“I’m a little sad or disappointed on that, but I have to see the situation and it goes how it goes.”
Tournament organizer Tennis Australia has been unapologetic in its decision to quarantine players, noting the safety of the local population as its priority.
Australia enforced some of strictest lockdown measures in the world last year, allowing the general public to now be relatively free of the virus.
CNN has reached out to Tennis Australia for comment on Tuesday but is yet to receive a reply.
Watson ‘didn’t feel as fit as usual’
Others confined to their hotel rooms ahead of the tournament fared better on Tuesday.
British player Heather Watson progressed through to the second round after defeating Czech opponent Kristyna Pliskova 7-6 (7-4) 7-6 (7-3).
Watson was one of many players to post funny videos to her social media accounts as she tried to keep herself amused during the two weeks in isolation.
Although happy with the win, the world No. 60 said she didn’t feel 100%.
“I didn’t feel as fit as usual, which is no surprise,” Watson told reporters. “I’m taking care of my body carefully because four days ago my left leg went into spasm and I couldn’t finish practicing.
“I was really worried about if I was going to be able to play my first round here.”
Elsewhere, Rafael Nadal cruised to a 6-3 6-4 6-1 victory over Laslo Djere as he started his bid for a 21st grand slam title.
The Spaniard needs just one more to overtake Roger Federer but told CNN Sport last month that he wasn’t obsessed with breaking his friend’s record.
“I know that will not be the key for my happiness in the future. It’s not extra pressure and it’s not an obsession,” he said.