The six-time champion had been playing in his first competitive tournament since a six-month injury layoff and at times, the former world number one looked to be struggling with an ongoing issue with his elbow.
However, world number 58 Chung produced the performance of his career and held his nerve at the decisive moments in the match to run out a 7-6 7-5 7-6 winner.
Djokovic had battled back impressively to take the first set into a tie-break, but Chung was having success on his opponent's first and second serve and it proved enough to take an early lead.
During the second, Djokovic looked to be on the verge of withdrawing from the match but after preventing Chung from moving a double-break ahead, the Serbian got back to 5-5, only to drop his serve once again.
The third set was more balanced, despite the players sharing four breaks, but for the second time in the contest, Chung kept his composure in the tie-break to claim the win in three hours and 21 minutes.