Anderson started well, but had to work hard at the end to win the first set (3-2). Then it was Dobey who dictated the game. The second set went to the Bedlington ace after back-to-back 14-dart legs.
In the third set The Flying Scotsman was not involved at all. That set went 3-0 to Dobey, who took over the lead from Anderson. The two-time world champion was unable to turn it around and saw the victory go to Dobey as Hollywood took out 74 for the win.
The 29-year-old will face Ian White in the quarter-finals, while Michael van Gerwen meets Mervyn King. The other two quarter-finals will be confirmed on Wednesday.
Click here for more information about this tournament, the only one to feature double start on the PDC Tour.
James Wade (78.59) 1-3 (85.83) Mervyn King (3-1, 2-3, 1-3, 0-3)
Michael Smith (76.98) 1-3 (86.29) Ian White (3-2, 0-3, 0-3, 2-3)
Michael van Gerwen (94.79) 3-0 (74.87) Jeffrey de Zwaan (3-0, 3-1, 3-1)
Gary Anderson (82.99) 1-3 (85.77) Chris Dobey (3-2, 2-3, 0-3, 1-3)
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