Nishikigi, who had lost to Terunofuji in their previous three encounters, deployed a textbook beltless arm throw in the day's final bout at Aichi Prefectural Gymnasium to improve to 2-0.
Terunofuji, who won his opening-day bout over Abi with ease, attempted to use an arm-barring force-out and shoved Nishikigi back to the edge but couldn't finish his opponent off and dropped to 1-1.
"I'm happy I could get the win," rank-and-filer Nishikigi said. "I got both arms inside and managed to throw him down just by going with the flow."
Terunofuji will look to bounce back on Day 3 when he faces another top maegashira, Tobizaru.
After returning from an extended absence due to knee injuries, Terunofuji won the May tournament with a 14-1 record and is bidding for his ninth Emperor's Cup in Nagoya.
Nishikigi was well-rested. He won by default on the opening day on Sunday when his opponent, ozeki Kirishima, was forced to withdraw due to a rib injury.
Successful Day for Sekiwake Trio
In other major bouts, sumo's three ozeki promotion-chasing sekiwake all posted wins to improve to 2-0.
Mongolian Hoshoryu shoved out former ozeki and current No 2 maegashira Shodai to start the clean sweep for the sekiwake grapplers. Shodai dropped to 0-2.
Wakamotoharu manhandled winless top maegashira Tobizaru.
Daieisho used a frontal thrust-out to send No 2 maegashira Mitakeumi backpedaling out of the ring.
All three sekiwake could be promoted to ozeki if they rack up strong records. Wakamotoharu and Hoshoryu would need 12 wins or more while Daieisho could earn promotion to sumo's second-highest rank with 11.
In other major bouts, former ozeki Asanoyama deployed a superb overarm throw to send fellow No 4 maegashira Ura sprawling to the dirt surface.
Asanoyama also hopes to be in title contention in the 15-day Nagoya Basho.
He went 12-3 in the May tournament in his comeback from a lengthy suspension for violating the Japan Sumo Association's COVID-19 guidelines.
Abi Bounces Back, Improves to 1-1
Komusubi Abi, who lost to Terunofuji on the previous day, fought off a strong opening charge by diminutive No 3 maegashira Midorifuji and used a push-down technique to improve to 1-1.
No 3 Meisei, the upset winner over Asanoyama on Day 1, bulldozed out komusubi Kotonowaka (1-1) in a matter of seconds to stay in the large group of wrestlers at 2-0.
Author: Jim Armstrong
The author is a longtime journalist who has covered sports in Japan for over 25 years. You can find his articles on SportsLook.
New Year Basho Tournament Records