The "Rocket" was nowhere near his best form in Beijing and looked unfocused as he slipped 3-0 behind, but a reprieve in the final frame before the mid-session interval allowed him to embark on a comeback.
Campbell missed an easy blue with the tight first frame seemingly won - but O'Sullivan gifted it straight back to him by taking on an over-ambitious black, and then conceded the next immediately after Campbell ended a long safety exchange by potting the final red.
In frame three, Campbell got the snooker he required on the pink and produced a great positional shot before holding his nerve to secure a re-spot, potting a second black to lead 3-0.
The Scot came back from needing four snookers in the next only to miss a routine pink, allowing O'Sullivan to get himself on the scoreboard before the interval.
And it proved the turning point as a series of good pots on the colours cut the arrears to one, an unfussy 65 break levelled matters and the two-time champion moved ahead for the first time with a 48.
Campbell set up a decider, in which he went 41 ahead, but O'Sullivan made a magnificent 77 to snatch victory and set up a clash with Mark Williams, who hammered home player Jin Long 5-1.
But Shaun Murphy suffered a shock exit to 18-year-old qualifier Lu Ning, who gave the Chinese crowd something to cheer with a stunning 5-2 win.
Lu cleared the last three colours to take the first frame and seized on a missed red by Murphy to go 2-0 up, but the 2005 world champion levelled before the interval.
It seemed normal service had been resumed, but the home player returned from the break with back-to-back centuries, 114 and 119, and then wrapped up the match with a 75.
"Can't really say much other than well played after that. Thought he was awesome," Murphy later wrote on Twitter.
Lu will face Ali Carter after the world number 14 battled past Dominic Dale 5-4.
After the pre-interval frames were shared, Dale nudged ahead only for Carter to respond and take a 4-3 lead.
A 45 helped the Welshman level but Carter got over the line with a half-century in the decider.
Northern Ireland's Mark Allen suffered a surprise exit at the hands of Ricky Walden.
Allen, coming off the back of his victory in the World Open in Haikou earlier this month, went down to a 5-2 defeat at the hands of Englishman Walden, who will now face Stephen Maguire in the next round.
"That didn't go as planned," Allen wrote on his Twitter account. "Poor performance and some costly errors at wrong time.
"All credit to Ricky. He played solid. Good luck to him."
The defeat marks the second year in succession Allen has crashed out at the opening hurdle in Beijing after his first-round loss to Campbell 12 months ago.
World champion John Higgins is safely through to the last 16 after seeing off Rory McLeod 5-1 and will now face Peter Ebdon, a 5-3 winner over Matthew Stevens today.
Stuart Bingham also progressed after defeating fellow Englishman Joe Perry 5-4.