There were never more than two frames between the pair, but Lisowski seemed to have the better of his opponent when he went 8-6 and then 9-7 up late on.
However, Ding kept in the fight, recording a break of 56 to make it 9-8 and then putting together an incredible 131 clearance in the 18th to force a final-frame decider.
Lisowski played clinically in that decider, going 84 clear to wrap up the frame as well as the match and set up a second-round clash with Stuart Bingham.
"I always thought it was going to be a really close game, everyone was saying it would be," Lisowski told BBC.
"My game is in really good shape and when you're confident in your cueing you've always got a chance.
"I just wanted a chance in the last frame and everything went in the middle of the pocket. It's probably one of my best wins ever."
Ding became the seventh seed to exit the tournament early on, with the likes of Mark Williams, Mark Selby and defending champions Luca Brecel all already accounted for in the first round.
O'Sullivan on the brink of victory
Ryan Day also knocked out a seed in the form of Barry Hawkins, beating the Englishman 10-8 - though there are only three ranking places between the pair.
Elsewhere, Mark Allen came through his match with Robbie Williams to win 10-6. Allen had raced to a 6-1 lead before Williams fought back to make it 7-4, but Allen ultimately had too much and, though he struggled at times, came away with a win that sees him set up a second-round match against either John Higgins or Jamie Jones.
Ronnie O'Sullivan was also in action on Wednesday, and has made enormous headway in his match against Jackson Page. O'Sullivan won the first six frames before Page pulled one back.
However, O'Sullivan's blistering form continued thereafter and he is now 8-1 ahead in a match that will finish on Thursday.
O'Sullivan, who would face Day in the next round should he make it there, is out to become the first person to win eight World Championship titles in the modern era.
