The second-seeded Spaniard broke his opponent four times en route to a 6-2 6-2 victory in one hour and 20 minutes.
Nadal was joined in the last 16 by compatriot and fifth seed David Ferrer, who overcame Radek Stepanek 7-6 (7/4) 6-2 on the controversial blue clay.
Gael Monfils, seeded 12th, progressed after Russian opponent Igor Andreev retired hurt when trailing 6-3 1-0.
Another seed, Alexandr Dolgopolov was made to work much harder for his last-16 spot, coming from behind to see off Andreas Seppi 6-7 (5/7) 7-6 (7/5) 6-3.
However, eighth seed John Isner fell at the second hurdle, beaten 7-6 (7/4) 7-6 (7/3) by Croatia's Marin Cilic.
Swiss Stanislas Wawrinka needed just an hour to overcome Jurgen Melzer 6-1 6-4, and will now face top seed and defending champion Novak Djokovic.
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In the women's second round, third seed Petra Kvitova saw her Madrid challenge ended by qualifier and Czech compatriot Lucie Hradecka.
Kvitova was broken five times as she fell to a 6-4 6-3 loss.
Fourth seed Agnieszka Radwanska faced no such problems on her way to a 6-0 6-1 rout of Sara Errani, while Roberta Vinci looked equally ruthless in despatching Yanina Wickmayer 6-1 6-2.
In the third round, eighth seed Na Li saw off Angelique Kerber 7-5 6-4 while Samantha Stosur, seeded fifth, was a 6-3 6-2 winner over Petra Cetkovska.
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