The Barassie teenager held on for a one-hole win over Stirling University team-mate Mathias Eggenberger of Switzerland to set up a clash with America Will McCurdy this morning.
McDonald had been two-up with two to play but plunged his tee-shot at the short 17th into a bunker and took bogey to give his rival hope.
Things got worse for the ex-Scottish Boys' Strokeplay champ when he found the rough with his drive on 18 and took three to reach the green.
However, as McDonald slipped to another bogey, Eggenberger's five-footer to force a play-off slipped by, and the local hope clinched a tense triumph.
McDonald, who had former Italian Open champ Dean Robertson as his caddie, said: "I thought I would lose that last hole and I was just about making my way to the first tee for the extra-holes before he hit that putt."
Edinburgh's Paul Ferrier was the only other Scot to make it through round one after a 7-and-6 demolition of England's Ben Stow.