The 22-year-old fought back from a dreadful start to take the first set to a tie-break, but ultimately went down 7-6 (6) 6-4 to miss out on a last-16 clash with American McCartney Kessler, who had earlier dumped world number three Coco Gauff out of the tournament.
However, she broke back in the fifth courtesy of a stunning backhand return down the line before holding serve for the first time, and she was right back in it when she broke for a second time in the ninth game to trail only 5-4.
Raducanu's disappointment was compounded when she was broken again in the first game of the second set and after failing to convert any of the three break points she earned in the sixth game, it was Muchova who edged across the line 6-4.
The 25-year-old sprang a surprise when she took the first set 6-4 and broke in the first game of the second to pile on the pressure.
Raducanu, who appeared to be in tears as she went to the umpire's chair after the second game, suffered a nightmare opening to a rain-delayed encounter, losing both of her service games as she fell 4-0 behind.
