Australia-based Gandy won 200m silver at last year’s World Championships in Shanghai and arrived in London ranked fourth in the world this year.
But her time of 2:09.92minutes in the heats was four seconds slower than her season’s best, ranking her only 17th, and she struggled to explain her sudden dip in form.
“I felt OK at the start but after 100m it was like I’d been hit by a truck,” she said. “I’ve been feeling fine and there are no health issues. I just don’t know what happened there.”
Great Britain are targeting a repeat of their swimming medal haul in Beijing when they claimed six podium places, including two golds.
So far they have only Rebecca Adlington’s 400m freestyle bronze to show for their efforts in the pool.
And while other podium contenders are to come, principally Adlington and Keri-Anne Payne in their world title events, the 800m freestyle and 10km open water, the target of six medals is already looking like a stretch.
Jemma Lowe though will consider herself in the mix for the 200m butterfly after progressing as third quickest in 2:07.64.
The Swansea-based swimmer was happy with her performance in the heats, but admitted that watching her teammates go before her was hard, and was full of support for Gandy.
She said: “I am really happy that I have made it to the next round as that was the aim this morning and it has been really hard for me these past few days.
“I am normally used to racing on the first day and having to watch my teammates has been hard but I am so pleased that first race is done and it was a good result.
“Ellen made the Olympic final in the 100m and that was brilliant and she had a great year last year but everybody has ups and downs and I am sure she gave it her best this morning.”
Michael Jamieson and Andrew Willis progressed second and third fastest to the 200m breaststroke semi-finals, with the former believing he still has more in the tank.
“It was easy to swim once I got a bit of confidence and that showed out there,” said Jamieson. “I just tried to work out what sort of form I was in and went from there.
“I think I have another gear as well so I am looking forward to the semi-final and we’ll see what happens there.”
Willis believes that if he can negotiate the semi-final, a medal is there for the taking in the final.
“I am really happy with that,” he said. “Looking at the heat times before mine it was tough out there and I did well to come back and I knew all along I couldn’t mess around.
“The key is to get in a final and then as you see this morning the crowd is livening up and the atmosphere was amazing and I can hear it down all the lengths especially the last.
“Hopefully we can make it to the final and then it’s anyone’s game.”
And there was also good news for Britain’s 4x200m freestyle relay team as Robbie Renwick, David Carry, Robert Bale and Ross Davenport combined to progress to the final as the fifth fastest.
However, Adam Brown, drafted late into the men’s blue-riband 100m freestyle was always going to struggle as he placed 20th in qualifying, in 49.20 seconds.
“I was a bit sluggish out there which didn’t help things, but it was a good experience for me as I’m still pretty young,” he said.
“I’ve got the 50m freestyle on Thursday where I hope I’ll bounce back and hopefully try and make a semi-final. I’ve got that one under my belt now and I’m looking forward to my next one."