The world No 11 from Nottingham scored a 6-5 victory to guarantee a cheque of at least pounds 40,000, more than double his best previous pay day. But it was hard luck on Drago, who described his second round success over the six-times Masters champion, Stephen Hendry, as the "best of my career".
The Maltese player fired in three centuries to defeat Hendry and twice reached three figures against last season's Thailand Masters semi-finalist. He also knocked in runs of 73, 67, 80 and 59 but could not shake off the dogged Hamilton.
It was his failure to escape from snookers that led to Drago's downfall. Hamilton was looking at a 5-3 deficit until he obtained 12 penalty points and levelled at 4-4 on a re-spotted black. They shared the next two frames before Hamilton made sure of a place in the last four with a decisive run of 70.
"Tony outplayed me," Hamilton said. "At times he didn't look as though he was going to miss. That eighth frame was massive because he would have been strong favourite at 5-3 up.
"Funnily enough, the match didn't go to plan. I was worried about my break-building before the start, but most of the frames were won in one hit."
Earlier, Scotsman McManus avenged recent defeats in the Welsh and Irish Opens plus the German Masters to end the 16 match unbeaten run of Mark Williams. McManus stumbled in sight of the winning post. He led 5-1, nearly finished at 5-5 but then sank pink and black to win the match 5-4.Reuse content