Serving at 1-1 in the second set, the world number one stooped after a forehand from behind the baseline and clutched his right foot before limping off the court at the change of ends during the late match.
After jiggling his foot around some more during the break, Nadal returned to the court to humble Monfils in just over two hours, running the 25th seed ragged and feasting on his second serve.
A beaming Nadal rated the match his best of the tournament, and though trying in vain to hose down soaring expectations, was unable to hide his delight with all aspects of his game.
"At the end no one is unstoppable," the 27-year-old told reporters. "Just one very good day. That makes me feel confident, but I am in fourth round. That's all.
"Today I think I have to say that I played well from everywhere."
The rangy Frenchman battled hard in the third set to prise breakpoints at 3-3, but Nadal's serve remained unbroken as he set up a clash with Japan's Kei Nishikori for a spot in the quarter-finals.
Monfils was edged by the 13-times Grand Slam champion in a tight three-set match in the Doha final, but said the Spaniard had reached another level.
"Definitely today he was in great shape," the 27-year-old said. "Much better than Doha, for sure. For me, I would say today was one of the best I have seen (him play) for a while."
Nadal has not conceded a break, let alone a set in his first three matches and has savoured his return to the blue hardcourts of Melbourne Park, where he was missed last year due to a stomach flu.
Nadal beat Asia's number one Nishikori in the fourth round at Roland Garros last year and holds a 5-0 lead over the 16th seed, last losing a set to the Japanese way back in 2008.
"I think Kei is a really complete player that can play on every surface," Nadal said. "But I think hard is the surface for him.
"Will be a tough one. I need to keep playing the way that I played tonight."
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- Kei Nishikori