World number one Carlos Alcaraz has been knocked out of the National Bank Open after losing to American Tommy Paul for the second straight year in Toronto.

The Wimbledon champion, who was on a 14-match winning streak, managed to fight his way back into the contest after dropping the first set 6-3, going on to win the second set 6-4.

But Paul fought hard and dominated the net, winning 21 of a possible 23 points there, and won the last set 6-3 to send him to the semi-finals.

“I played a really good match today,” Paul told the ATP website post-match.

“You can’t start any points on your heels against him or he’ll take advantage of that.

“So you really have to go after your shots early in the rally and I was feeling really good on the first-strike tennis. That was the difference today.”

In another upset, Alex De Minaur beat world number three Daniil Medvedev in straight sets.

Carlos Alcaraz suffered a rare defeat Carlos Alcaraz suffered a rare defeat (Frank Gunn/AP)

A tough contest saw the Australian emerge victorious after two hours and two minutes with a 7-6 (7) 7-5 win.

De Minaur came back from 2-5 down in the first set to claim the opener in a tie-break and then came from a break down twice in the second to seal the match.

“I had to play some of my best tennis today, it has been a great week for me so far,” he said after the match.

“I played the right way today. I think having played him at the end of last year gave me the confidence that I had a chance. I just had to play the right way and I am extremely proud of the effort and to still be alive.”

Victory ensured De Minaur reached a first-ever Masters 1000 semi-final, where he will now face Alejandro Davidovich Fokina in the final four on Saturday.

Davidovich Fokina reached the semi-finals after beating Mackenzie McDonald 6-4 6-2.