The Chinese star beat the Northern Ireland potter 4-3 with a break of 108 in the decider clinching the contest.
Ding fell 2-1 behind after his maximum but then got back on terms with a wonderful 138 run and an 81 break then put him in front.
Allen replied in similarly impressive fashion with a 125 break to make it 3-3 before Ding took the final frame.
The first man to book his place in the semi-finals was Tom Ford who started his match against Marco Fu with break of 63 and finished with an 84 on his way to a 4-1 victory.
Ford will play Neil Robertson in the semi-final. The Australian former world champion was not at his best but still had enough to beat Xiao Guodong 4-1 in his quarter-final.
The final quarter-final saw Kurt Maflin edge out Ben Woollaston 4-3 with breaks of 89, 62 and 66 in a come-from-behind win. He will next take on Ding.