Sania and her partner Virginia Ruano Pascual overcame an indifferent start to reach the pre-quarterfinals of the women's doubles event.
The 10th seeded Indo-Spanish pair overcame a fighting Timea Bacsinszky of Switzerland and Italian Tathiana Garbin 7-6(3) 6-3 in their second round match at Melboune Park. They were trailing 1-4 in the opening set but soon found the touch and never looked back.
They will next take on the winners of the Melinda Czink /Natalie Grandin vs Alisa Kleybanova/Francesca Schiavone second round match.
Seasoned Paes and his Zimbabwean partner Cara Black also had a tough first round as they scored a hard earned 7-5 7-5 win over local wildcard entrants Sophie Ferguson and Carsten Ball in the mixed doubles event.
Their next opponent will be winners of the Andrea Hlavackova/Lukasz Kubot vs Carly Gullickson/Bernard Tomic tie.
Meanwhile, Somdev Devvarman and Prakash Amritraj suffered a crushing 1-6 3-6 defeat at the hands of 11th seed Swede Simon Aspelin and Australia's Paul Hanley in the men's doubles second round.
Both Somdev and Prakash Amritraj had failed to qualify for the singles main draw.
Bhupathi-Sania pull out of mixed doubles
Mahesh Bhupathi and Sania Mirza will not defend their mixed doubles title at the Australian Open due to a calf injury to the former.
Bhupathi suffered the injury on Monday while practicing and aggravated it during yesterday's men's doubles first round match which he lost along with his Belarusian partner Max Mirnyi.
According to Bhupathi, the doctor has advised him at least 10-day rest resulting in them pulling out of the first Grand Slam of the season.
With this pull out, Bhupathi's campaign is over at the Australian Open.
Sania Mirza is already out of singles but her challenge is still alive in the women's doubles event.