In response to a time violation at the end of the second set, Kyrgios chuntered before imitating Rafa's ticks -- a swipe of the hair on either side followed by a pick at the seat of his shorts.
No matter that he forgot the nose scratch, there was no doubt who he was sending up in relation to slow play. His impression raised a grin on the face of the chair umpire in Melbourne.
Early in the third set his opponent, Gilles Simon of France, also received a time violation, and cracked up Kyrgios by doing his own rendition of Rafa's routine.
The reaction was mixed on social media, with some agreeing with Kyrgios and others saying he would be better to try to match Nadal's efforts in winning 19 grand slams.
Kyrgios lost the third set and was made to work hard for a 6-2 6-4 4-6 7-5 victory which puts him in the third round with a possible meeting against Nadal in round four.
Afterwards Kyrgios was asked whose impression was better. "I don't wear underwear, so probably Gilles," he told reporters.
The Spanish great won his second-round match with ease, and when told of Kyrgios' antics said: "I really don't care. I am here to play tennis. Honestly, I don't care at all. If was funny, good. That's it."
The 24-year-old Kyrgios was later asked about some of the comments he directed towards his team in his box.
"I was being a bit of a dickhead to them," he told reporters. "I apologized as soon as I went back into the locker room. They don't deserve that. They do a lot of things for me on and off the court. No, it's not acceptable from me."
Australian Kyrgios and Nadal have a checkered history.
Last year, Kyrgios labelled Nadal "super salty" in a podcast with tennis journalist Ben Rothenberg and took aim at his famous uncle, Toni. He admitted ahead of their pulsating second-round clash at Wimbledon that they would be unlikely to go to the pub together for a drink.
After the game, Kyrgios astonishingly reveled he meant to hit the Spaniard with a thunderous forehand which cannoned off his chest.
Earlier that season, they played in a spicy encounter in Acapulco, Mexico. At one point, Kygrios pulled out an underarm serve and afterward Nadal claimed the Canberra native needed to show more respect to opponents, the crowd — and himself.
Kyrgios countered by criticizing Nadal's sometimes slow play between points.
The controversial Kyrgios was given a suspended 16-week ban and fined $25,000 for "aggravated behaviour", subject to a six-month probationary period after smashing two rackets in temper at the Cincinnati Masters in August.
He had also received a number of fines for unsportsmanlike behavior earlier in the season.
Ahead of the Australian Open, Kyrgios broke down in tears at the ATP Cup after pledging to donate AUS $200 for every ace he hits at tournaments in January.
"It's a real thing and it's bigger than tennis," he said.
After Kyrgios' first-round match in Melbourne, American great John McEnroe interviewed Kyrgios on court and pledged to donate $1000 to the bushfire fundraisers for every set Kyrgios wins at the Australian Open.