MASTERS CUP, Shanghai:
Dates: 9-16 November Starts: 0600/1000 GMT daily Coverage: Live on Sky Sports; live text commentaries on BBC Sport website; every match live on Radio 5 Live sports extra
Federer is aiming for his fifth Masters Cup title and his third on the trot
World number two Roger Federer suffered a shock 4-6 6-4 6-3 defeat by France's Gilles Simon as he began the defence of his Masters Cup title.
Federer, playing in Shanghai despite suffering from a back injury, began well and eased to the first set.
But Simon upped his game in the second set and came through a tense and error-strewn decider for a thrilling victory.
Federer is in the same Red Group as British number one Andy Murray, who beat Andy Roddick later on Monday.
The top two will go through to the semi-finals, along with two from the Gold Group of Novak Djokovic, Nikolay Davydenko, Juan Martin del Potro and Jo-Wilfried Tsonga.
It was an erratic performance from the Swiss star, moments of brilliance interspersed with some desperate errors, particularly on the forehand and at the net.
"The better you play, the better he plays, he's quite an unusual player and he makes you work hard and runs very well," Federer said afterwards.
I defeated him once in Toronto, so it was easier to finish the match. I had no complex when I served in the last game
"Definitely today I missed shots I normally don't miss. I think that's just lack of practice. It's the only tournament where I really have a chance after losing the first match so I'm happy it happened here."
Federer went into the match having lost to Simon in their only previous meeting in Canada earlier this year, but the US Open champion made a solid start against the Masters Cup debutant.
After missing three break points in game three he moved ahead with a forehand winner for 3-2, saved a break point in the following game and went on to take the set with a second-serve ace.
When Federer broke again at the start of the second set, a routine win looked within sight.
But Simon hit back immediately, missing two break points when leading 4-3 before finally making the deserved breakthrough two games later.
Federer found himself facing set point on serve and wasted two chances to punch away volleys before Simon made him pay with a backhand volley of his own.
In the deciding set it was the Frenchman who had the edge, just failing to convert from 0-40 at 3-3 as Federer got out of trouble with a big serve, a forehand winner and a sublime backhand volley.
It was Federer's chance in the following game and this time the Swiss wasted a 0-40 lead, Simon finding a winning pass and an ace before the champion made yet another wild error on the forehand.
At 4-3, Simon made the decisive move, angling away a cross-court backhand to earn two more break points and taking the second with a forehand into the corner.
The 23-year-old from Nice showed nerves of steel as he served out for the biggest win of his life, finishing Federer off with an uncharacteristic serve-volley and an ace.
"I'm very happy and very exhausted," said Simon. "It was a very long match but I played my best tennis in the last two sets. I knew I had to do that - it is always hard to win against Federer.
"But in another way, it's easier for me because I have no questions in my head.
"I defeated him once in Toronto, so it was easier to finish the match. I had no complex when I served in the last game."
"And for sure, it was again one of the best victories of my career.
"I was first really happy to come here because I was just number nine in the world. When I got on court I wanted to use the opportunity to win. I kept that in my mind from the beginning of the match."