It was a similar story in the third set as Federer broke for the second time in the match to set up a fourth-round clash with either Bernard Tomic of Australia or Alexandr Dolgopolov of the Ukraine.
Federer, 30, who came into the clash with a 9-1 head-to-head record against his 57th-ranked opponent, is bidding to become only the second man to win five Australian Open singles titles, after Roy Emerson.
Second seed Nadal overcame Slovakian qualifier Lukas Lacko in straight sets to reach the fourth round 6-2, 6-4, 6-2.
Nadal wore down the 119th-ranked Lacko after being forced to work hard at the start of the match. The opening point was a 28-shot rally and the first two games took 14 minutes.
The Spanish world number two went on to break Lacko's serve six times to complete victory in 1hr 55min on Rod Laver Arena.
Nadal will now face either American 16th seed John Isner or Spain's 18th seed Feliciano Lopez in the round of 16 on Sunday.
"I have a good feeling, even though the first set was 6-2 it was a really tough one. Lacko is a young player and I wish him all the best for the rest of the season," Nadal said.
The Spaniard claimed the Australian Open title in 2009 but was forced to retire hurt against Andy Murray in 2010 and was hampered by a left adductor injury in his quarter-final defeat to David Ferrer last year.