Raducanu, who reached the fourth round in California last year, fell 6-3, 7-5 against two-time major winner Sabalenka as she continues her return.
The 21-year-old, who is rated 250th in the world, received a wildcard into the competition after missing 2023 due to injury.
Raducanu described her week as “a good success.”
“I believe I handled myself much better on the match court. I was a lot more upbeat and eager to play, and I believe it showed in the tennis matches I did play.”
Raducanu’s second-round victory over Dayana Yastremska, who retired due to sickness, marked the first time the player has recorded it.