A wild card in this event, Sampras fell, 6-3, 6-4 in a match that lasted just over an hour.
Sampras entered the grasscourt season looking to end a title drought that has lasted almost two years. He has not won since claiming his seventh Wimbeldon title in 2000.
Kiefer advances to a quarterfinal meeting with Alexander Popp of Germany, who defeated Stefan Koubek of Austria, 6-4, 6-2.
The only other seeded player in action on Thursday was second seed Roger Federer of Switzerland, who is emerging as one of the favorites for Wimbledon, which begins in 10 days. Federer advanced into the quarterfinals with a 6-2, 6-4 win over David Prinosil of Germany.
The next opponent for Federer will be Mikhail Youzhny of Russia, who defeated Andrei Pavel of Romania, 6-4, 6-0. Denmark's Kenneth Carlsen completed a 3-6, 6-4, 6-4 win over Switzerland's Michel Kratochvil. The match was suspended by rain Wednesday.
Defending champion Thomas Johansson of Sweden and two-time winner Yevgeny Kafelnikov of Russia moved into the quarterfinals Wednesday.
Johansson, the third seed, posted consecutive wins for the first time since the Tennis Masters Monte Carlo in April as he eliminated Croatia's Ivan Ljubicic.
Kafelnikov, the top seed who is ranked just 34th in the ATP Champions race, notched straight sets win over French qualifier Cyril Saulnier.