Dementieva prevented Williams serving for the match at 6-5 in the second set. Then the American's game fell apart in the decider as Dementieva raced out to 4-0. The Russian, who struggled with her serve in the first two sets and finished with 15 double faults, converted her second match point with a running backhand winner at the net.
In the opening match, Victoria Azarenka made a successful tournament debut by defeating Jelena Jankovic 6-2, 6-3.
Story continues below ↓advertisement | your ad hereLater Tuesday, second-ranked Serena Williams faced French Open champion Svetlana Kuznetsova.
The tournament features the top eight players in the world, with four women in each group. The top two from each group advance to the semifinals. Top-ranked Dinara Safina and No. 4 Caroline Wozniacki play their first match on Wednesday.
Aside from a winner's check of up to $1.55 million, Safina and Serena Williams are also vying for the year-end No. 1 ranking. Safina's margin is so slim that the player who performs best here will end 2009 atop the list.
Venus Williams took a quick 3-0 lead and looked set for a routine victory after breaking Dementieva again to start the second. However, the fifth-ranked Russian converted her first break point to level at 3-3, only to lose the next three games.
In the second, Williams broke for 6-5 when Dementieva double-faulted for the 13th time, but followed up by netting a lunging backhand on break point in the next game. In the tiebreaker, Dementieva took a 6-3 lead but wasted all three set points, before Williams double-faulted on the fourth.
Azarenka took advantage of Jankovic's shaky forehand to break five times, including the Serb's last two service games.
Jankovic looked sluggish and error-prone from the start, and was broken in the first game. She finished with 33 unforced errors, to 15 by Azarenka.
"I basically gave her everything. I beat myself," Jankovic said. "I just was trying to get in the match, get my rhythm. But unfortunately, that never happened. ... I was really a shadow of myself."
Azarenka is making her first appearance in the $4.55 million tournament, while Jankovic qualified for the third time.
"I'm glad she gave me the match, and she was not in the mood," Azarenka said. "It worked out pretty well for me."
© 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Serena, Safina will battle for No. 1 in DubaiUjfalusi eyes Chelsea scalp