Real's club-record run of 22 consecutive competitive wins came to a halt on Sunday night, when Valencia came back to overturn Cristiano Ronaldo's opening penalty and seal a stirring 2-1 win at the Mestalla.
And boss Carlo Ancelotti could not have asked for a tougher last-16 assignment as Real have failed to beat their neighbours in three attempts this term, even though they did knock Atletico with a 5-0 aggregate thrashing en route to Copa del Rey glory last season.
The reigning La Liga champions left the Santiago Bernabeu with a 1-1 draw in the first leg of August's Spanish Super Cup, a title they would lift thanks to Mario Mandzukic's early strike in the return encounter.
Goals from Thiago and Arda Turan then gave Atletico a 2-1 league triumph across town - the last game Real failed to win before coming undone at the weekend.
Atletico boss Diego Simeone has a notable boost to his forward options for the game following Fernando Torres' return to the Vicente Calderon, seven-and-a-half years after he left to join Liverpool.
Despite an underwhelming spell with Chelsea and this season's disappointing loan stint at AC Milan, 45,000 fans turned out to see Torres' presentation at Atletico's home stadium on Sunday and the 30-year-old is anticipating a typically crackling derby atmosphere for Wednesday night's first leg.
"The crowd will never be a problem for the team. They help the team to earn points, more so than any other fans in Spain," he told a press conference, as quoted by the Football Espana website.
"When I last qualified for the Champions League [with Atleti], they collaborated. Wednesday will surely be a stunning derby."
Barcelona are similarly striving for a return to winning ways after failing to capitalise on Real's slip-up, falling to a dispiriting 1-0 loss at Real Sociedad on Sunday.
Head coach Luis Enrique was heavily criticised for leaving star men Lionel Messi and Neymar on the bench in San Sebastian, meaning there will be plenty of intrigue surrounding his selection when lowly Elche visit the Nou Camp on Thursday.
Messi and Rafinha both missed training through illness on Monday, which proved to be a turbulent day off the field for Barca as sporting director Andoni Zubizarreta was relieved of his duties and long-serving former captain Carles Puyol also left an administrative role.
Sociedad and Valencia will look to build on their famous weekend triumph by travelling to Villarreal and hosting Espanyol respectively in a round of 16 that holds no interest outside of the top flight.
Amid this absence of potential giant-killing stories, Celta Vigo versus Athletic Bilbao and Malaga against Levante kicks off the round on Tuesday.
Almeria welcome Getafe on Wednesday, while Granada entertain 2010 winners Sevilla on Thursday.
