The Australian world number six is regarded as one of the best exponents of grass court tennis, but was unable to handle the aggressive Nakashima in a 7-5, 6-3 quarter-final defeat.
A tight opening set dominated by serve was edged by world number 32 Nakashima as he converted the first break point of the match in the 12th game.
De Minaur had a chance at 1-1 in the second set on Nakashima's serve but was unable to take it.
On a boiling hot day on Andy Murray Arena, he dropped serve at 3-4 , and there was no way back as Nakashima clinched his first win against a top-10 player in two years.