Paul Biedermann of Germany was fastest in 1 minute, 45.30 seconds.
Swimming his first individual event, Phelps clocked 1:45.60. Danila Izotov of Russia qualified third for the semifinals later Monday.
Phelps set the world record of 1:42.96 at last year's Beijing Olympics.
On Sunday, Biedermann broke Ian Thorpe's seven-year-old world record in the 400 free.
Phelps also won his first gold Sunday, swimming the leadoff leg for the Americans in the 400 free relay.
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