Li's first-round loss was the major story of the day, with the 2011 champion stunningly claiming that she could not try her best after the match.
The Chinese player - who won the Australian Open earlier this year – also claimed that any player on the WTA Tour would have beaten her, such was her mindset.
Frenchwoman Mladenovic won 7-5 3-6 6-1 in just over two hours in front of a partisan crowd.
Li's shock exit meant that the winners of both the men's and women's singles titles at the Australian Open did not make it through the first round at the second grand slam of the tennis year.
Mladenovic won 74 per cent of points on her first serve while Li made 37 unforced errors in an uncharacteristic performance.
Wozniacki was another seed to lose, with Belgian Yanina Wickmayer defeating her 7-6 (7-5) 4-6 6-2.
Wickmayer smashed 32 winners and claimed six breaks, negating the impact her 46 unforced errors had on the contest.
The 13th seed has now failed to make it to the last eight of any grand slam since the 2012 Australian Open.
It was not all bad news for the seeds in the women's draw, though, as fourth seed Simona Halep showed her class with a 6-0 6-2 destruction of Russian Alisa Kleybanova.
The Romanian was on court for just 56 minutes and made six breaks in a convincing triumph, setting up a second-round meeting with Heather Watson, a straight-sets winner over Barbora Zahlavova Strycova.
Sixth seed Jelena Jankovic had to work harder for her win, coming from behind topple Canadian Sharon Fichman 5-7 6-1 6-3.
The Serb smashed 38 winners in an impressive response to her early setback.
Compatriot Ana Ivanovic also progressed, thrashing Frenchwoman Caroline Garcia 6-1 6-3.
The 2008 winner consistently took advantage of Garcia's sloppy serving, making five breaks en route to a comfortable progression.
Sara Errani, seeded 10th, overcame a slippery court surface and stiff opposition from Madison Keys to progress by a 7-5 3-6 6-1 scoreline.
Other results involving seeds saw Sloane Stephens beat Shuai Peng 6-4 7-6 (10-8) while Kirsten Flipkens beat Danka Kovinic 7-6 (8-6) 6-2.
Ekaterina Makarova cruised past Shelby Rogers 6-2 6-3 and the former's fellow Russian Anastasia Pavlyuchenkova toppled Japanese veteran Kimiko Date-Krumm 6-3 0-6 6-2.
Seeds Svetlana Kuznetsova, Lucie Safarova and Sorana Cirstea also progressed, but Klara Koukalova fell to Maria-Teresa Torro-Flor.
In other matches, the women's draw saw two withdrawals due to injury on Tuesday - a wrist injury and ankle injury forcing Petra Martic and Urszula Radwanska out of respective matches with Elina Svitolina and Magdalena Ryabrikova.
Julia Glushko, Camila Giorgi, Coco Vandeweghe, Teliana Pereira, Alison Riske and Kiki Bertens all celebrated advancing to the second round in Paris for the first time.
They will be joined in the next phase by Dinah Pfizenmaier, Casey Dellacqua, Polona Hercog and Silvia Soler-Espinosa.