Halep swatted aside Danka Kovinic, the conqueror of US Open champion Emma Raducanu, 6-2, 6-1 in just 64 minutes and will face French veteran Alize Cornet on Monday for a place in the quarter-final.
The fit-again Halep came into the tournament full of confidence after her first title in 16 months earlier this month at a Melbourne warm-up event and was always in charge.
"I feel great that I can play the fourth round again. I always love to play in Australia so that's why maybe I play good matches," said Halep.
Seeded 14, Halep has been in insatiable form, dropping just nine games in her opening two matches, and she carried it into her clash against the 27-year-old.
Cornet slugged it out with Slovenia's 29th seed Tamara Zidansek for a 4-6, 6-4, 6-2 victory and said she was just glad to get through on a hot day.
"It was mostly about survival," said Cornet, who produced a stunning upset of world number three Garbine Muguruza in round two.
World number two Sabalenka overcame the serving problems that have been plaguing her early season, but still needed three sets to get past 31st seed Marketa Vondrousova.
The Belarusian had served 70 double faults in her previous four matches in 2022, but only tallied 10 as she beat the Czech 4-6, 6-3, 6-1.
She now meets unseeded Estonian veteran Kaia Kanepi who overpowered Australian wildcard Madison Inglis 2-6, 6-2, 6-0.
"I'm really happy right now and mostly happy that I made only 10 double faults," said Sabalenka, a semi-finalist last year at both Wimbledon and the US Open.
American world number 30 Danielle Collins, who seems to raise her game in Melbourne where she was a semi-finalist three years ago, is also through to the last 16 after battling past tenacious Danish teenager Carla Tauson 4-6, 6-4, 7-5.
- 'Long battle' -
Collins, the 27th seed, was a set and 1-3 down against the emerging star before fighting back.
"It was a long battle and super happy to be able to pull it out," said Collins.
She now has a last-16 clash against the 2018 semi-finalist Elise Mertens, after the Belgian 19th-seed cruised past China's Zhang Shuai 6-2, 6-2.
In the men's draw, US Open champion Medvedev cemented his status as tournament favourite by overcoming the mercurial Nick Kyrgios in four sets in a raucous second-round encounter.
Medvedev, the de facto top seed after Novak Djokovic was deported on the eve of the tournament, faces a more conventional opponent in Dutch world number 57 Botic van de Zandschulp for a place in the last 16.
But he will not take his opponent lightly. "Grand Slams are tough, there are going to be tough opponents," said Medvedev.
Fourth seed Stefanos Tsitsipas is a potential semi-final opponent for Medvedev, but first he needs to get past seasoned French world number 56 Benoit Paire on Rod Laver Arena.
The weight of British expectation falls entirely on the shoulders of 24th seed Dan Evans after Andy Murray and Raducanu made early exits.
The last Brit standing had an unexpected day off on Thursday when his French opponent Arthur Rinderknech pulled out with injury giving him a walkover into the third round.
Evans faces in-form ninth seed Felix Auger-Aliassime, who was part of Canada's ATP Cup-winning team in Sydney earlier this month.
There is an intriguing clash between fifth seed Andrey Rublev of Russia and 2018 Melbourne Park finalist Marin Cilic of Croatia that has the potential to be a late-night classic on Margaret Court Arena.
Cilic pushed Roger Federer to five sets in the final four years ago and the big-serving 27th seed is capable of upsetting anyone.
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