Spaniard Nadal, who extended his record winning streak on clay to 64 matches, took 62 minutes to demolish Belgian Kristof Vliegen 6-1 6-1 while Federer eased past South Korean Lee Huyng-taik 6-4 6-3 in 64 minutes.
The 20-year-old will now face German qualifier Phillip Kohlschreiber who as forced to save match points in the second set before battling to a 5-7 7-6 7-6 win over Guillermo Garcia-Lopez.
"I was feeling very good today and I'm really happy to be in the last eight," said Nadal, who lost his serve in the first game of the second set before winning 21 points in a row.
Monte Carlo Masters
Nadal claims first serve the key
22/04/2007 AT 17:17
Federer meets claycourt specialist David Ferrer after the Spaniard recovered from a sluggish start to knock out sixth seeded Serb Novak Djokovic 7-5 6-4.
The top seeded Swiss, who arrived in Monaco with back-to-back defeats by Argentine Guillermo Canas in Miami and Indian Wells, broke decisively in the ninth game of the opening set to take control.
"He's an excellent player, especially on clay. This is where he's got the most confidence, so it's going to be difficult for me to beat him here," said Federer, who has never dropped a set against Ferrer in their five previous meetings.
After that, the Swiss who has 10 Grand Slams to his name but has yet to win the French Open, was never in bother and clinched victory in 64 minutes.
"I think it was an average match from my side. Maybe it was just my timing at the beginning. I was just shanking a lot of balls and not able to keep the ball in play," he said. "Once I was able to do that I was in total control."
Former French Open champion Juan Carlos Ferrero of Spain moved closer to the form that allowed him to win at Roland Garros four years ago to defeat Russian Igor Andreev 6-3 6-3.
Ferrero takes on Frenchman Richard Gasquet, who battled two hours and 50 minutes to see off Croatian seventh seed Ivan Ljubicic 6-3 6-7 7-5.
"I made a superb passing shot on match point," 11th seed Gasquet said.
"We both fought until the end and that is what made of this match a great one. I was tense in the second set, that is why I lost the tiebreak."
Czech prospect Tomas Berdych fought back from a set down to advance with a 1-6 6-3 6-2 victory over fifth seeded Spaniard Tommy Robredo.
The 10th seed faces a last-eight encounter against Sweden's Robin Soderling, who had earlier battled to a 7-6 6-2 victory over Max Mirnyi of Belarus.
The 21-year-old Berdych was overwhelmed by claycourt specialist Robredo in the opening set, which the Spaniard clinched in 36 minutes, before an early break in the second was enough to force a decider.
Berdych, who reached the fourth round at last year's French Open, broke twice and wrapped up the win on his first match point.
World number 28 Soderling recovered from an early break to force a tiebreak, which he won 7-5, before stepping up a gear in the second set.
Soderling converted three of his nine break chances in all to seal victory in 88 minutes on his first match point.
Monte Carlo Masters
Fed: Rafa forces me to improve
22/04/2007 AT 16:39
Monte Carlo Masters
Nadal wins third Monte Carlo title
22/04/2007 AT 12:17