Donald was over eight seconds inside McGuinness’ official lap record
Cameron Donald completed the Mountain Course in 17 minutes 13.25 seconds on Thursday to unofficially become the fastest man in TT history.
On his fourth lap of the session the Australian became the first man to lap the course at over 131 mph.
The TAS Suzuki rider's average speed was a staggering 131.457mph.
Donald's team-mate Bruce Anstey was the second fastest man on the night, lapping at 130.129 mph, with Ian Hutchinson third at 129.027mph.
Official lap record holder John McGuinness suffered mechanical issues with his HM Plant Honda superbike and was unable to fight for a place at the top of the leaderboard.
However McGuinnesses' time from Wednesday night is still the second best of the week.
Manx rider Conor Cummins put in an excellent 128.334mph lap in what was an extraordinary practice session for Saturday's Dainese Superbike race.
Meanwhile, Michael Dunlop smashed the Supersport 600cc record with a 126.299 mph lap, albeit unofficial.
Guy Martin topped the superstock times with a 126.054mph lap.
The practice session for sidecars which followed was cut short by a large oil spillage from Bray Hill to Quarterbridge.
The final practice session will take place on Friday.
2009 TT Best Times
1. Cameron Donald (Relentless by TAS Suzuki) - 131.457mph
2. John McGuinness (HM Plant Honda) - 130.171mph
3. Bruce Anstey (Relentless by TAS Suzuki) - 130.129mph
1. Nick Crowe/Mark Cox (HM Plant Honda) - 116.063mph
2. Dave Molyneux/Dan Sayle (A&J Racing Suzuki) - 114.697mph
3. Phil Dongworth/Gary Partridge (WAS Autocentre Honda) - 112.400mph