But Australian No.1 Alex de Minaur's run at the ATP Masters 1000 event is over after he crashed out at 7-5 6-4 the hands of 36-year-old Frenchman Gael Monfils.
In only his third career meeting with a top-10 player, Purcell stunned an opponent who has reached three of the last six grand slam finals.
His 6-4 3-6 6-4 victory came in just under two hours, and takes the Sydneysider's run to seven wins in eight matches over the last two weeks.
Purcell was outside the world's top 200 a year ago, and seen primarily as a doubles player, but he rocketed up the singles rankings early in 2023 with an impressive spell on the Asian circuit.
Despite disappointing results in the European clay-court swing, and on grass, when he was hampered by an ankle injury, Purcell has stayed in the top 80 since May and is now seeking to push on in the north American hardcourt season.
Norway's fifth-seed Ruud is ranked 63 places above Purcell, but encountered stiff resistance in the pair's first meeting on the tour since Ruud won 7-6 (7-5) 7-5 in US Open qualifying five years ago.
In the last 16 Purcell will face either world No.10 Frances Tiafoe or three-time grand-slam champion Stan Wawrinka.
The day's second big shock came with a 6-4 7-6 (7-4) win for Serbia's Dusan Lajovic over world No.6 Jannik Sinner.
The Italian earned his first Masters 1000 title days ago in Toronto, beating De Minaur in the final, but was unable to keep the momentum alive, failing to convert any of the five break-point chances he had across the match.
Having dispatched De Minaur, Monfils will meet No.2 seed Novak Djokovic, whose second-round opponent Alejandro Davidovich Fokina was forced to retire with a back injury having lost the first set 6-4.
"He brings so much joy to the fans, so much entertainment," Djokovic said of Monfils.
"He's one of the most charismatic players we've had in the last two decades on tour and he's playing better than ever."
Already in the third round is Alexei Popyrin, who progressed on a walkover after opponent Nicolas Jarry withdrew to return to Chile for the birth of his second child.
Former champion Daniil Medvedev beat Italy's Lorenzo Musetti 6-3 6-2 in an error-riddled match.
"We both made some mistakes, we both made some double faults and stuff like this," third seed Medvedev, who served five double faults, said.
"But I managed to be a little bit better in the important moments."
There were victories for US players Tommy Paul and Taylor Fritz, who defeated Ugo Humbert and Lorenzo Sonego respectively.
Alexander Zverev also progressed, beating Yoshihito Nishioka 7-5 6-4, while Australian Open finalist Stefanos Tsitsipas dropped only three first-serve points on his way to a 7-6 (7-3) 7-6 (7-2) win over Ben Shelton.
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