It marked Ruud's first victory over the Spaniard in five career meetings and the result could make it difficult for Alcaraz to advance from the round-robin stage at the season-ending event for the year's top eight players.
"I didn't feel well on court," Alcaraz said. "A few days before coming here, I got sick at home. ... This morning, I feel uncomfortable in the stomach."
Alcaraz won the French Open and Wimbledon this year to boost his career total to four majors. But he struggled at the Paris Masters recently and dropped behind Alexander Zverev to No. 3 in the rankings this week.
Ruud reached the semi-finals and final in his first two appearances at the season-ending tournament in 2021 and 2022, respectively.
Alcaraz looks disconsolate as he slides towards a 6-1 7-5 defeat against Ruud in Turin. (AP PHOTO)
World No.7 Ruud saved break points in the opening game but dominated the first set from then on as surprising errors flowed from the Spaniard's racket.
Alcaraz responded positively to move 5-2 ahead in the second set, breaking serve with a deft volley, and was two points from levelling the match only to capitulate.
He dropped serve at 5-3 and looked forlorn as Norwegian Ruud roared to victory, winning the last five games.
"It's only one match but it's definitely one of the best wins of the season for me in terms of who I'm playing, his level, his ranking," Ruud said in an on-court interview.
"We will see Carlos play better tennis than he did today but I took care of my chances and it was a great win for me - hopefully I can build on it."
Besides illness Alcaraz blamed inexperience on the surface and mental exhaustion.
"I'm tired mentally," Alcaraz said. "Obviously a lot of matches, really tight schedule, really demanding year with not too many days off.
"I have no experience playing on indoor courts," he added. "I'll be a really good player on indoor courts, I'm sure about it. But I think it's about time, about getting experience. ... A lot of players are better than me on indoor court."
Later on Monday Zverev plays Andrey Rublev in the other opening round match of the group named after Australian great John Newcombe.
On Sunday, in the Ilie Nastase group, Australia's Alex de Minaur lost to top-ranked Jannik Sinner and US Open finalist Taylor Fritz beat Daniil Medvedev. De Minaur plays Medvedev in his second match on Tuesday (likely early Wednesday AEDT).
The top two finishers from each group advance to the last four.
with agencies