He should have reached the 2003 World Championship final, where he led KenDoherty 15-9 in the semi-finals before the Irishman stormed back to win 17-16.
Williams, the provisional world number 42, lost 4-1 to KenDoherty and the exit now leaves the Welshman in serious danger of failing to secure a top 32 starting rank next season.
But Irishman KenDoherty kissed goodbye to his hopes after losing 4-3 to Ian McCulloch, a third loss which left him propping up the six-player group headed by unbeaten Ricky Walden.