The Finn, making his event debut, was caught out while cutting a right-hander - resulting in significant contact with a boulder that caused heavy damage the front right of his GR Yaris.
Lappi was able to pull over in a safe position on the road where he discovered damage to the suspension and driveshaft that has forced him out of the rally.
Toyota team boss Jari-Matti Latvala is hopeful the car can be fixed to allow Lappi to rejoin the rally on Saturday under restart rules.
“Esapekka only managed to get around for or five kilometres and it looks like he cut on a right corner and he touched a big rock and damaged the front right suspension,” said Latvala.
“I haven’t spoken with the guys but you could see a piece of the driveshaft was coming out, normally this means you do quite a lot of damage on the front right corner.
“Let’s say when we get the car back I’m sure it will be an easy fix and he will restart tomorrow. He didn’t have experience on this event and it lasted only four kilometres today.
It proved to be a bittersweet stage for Toyota as championship leader Kalle Rovanpera ended the 19.2km test with the fastest time, while team-mate Elfyn Evans suffered a early blow to his rally hopes after suffering a front left puncture that cost him 1minute 20s.
Evans wasn’t the only driver to suffer a puncture as M-Sport’s Pierre-Louis Loubet picked up a double front puncture that reduced him to crawl through the stage. Luckily the Frenchman is carrying two spare wheels.
Overnight rain created treacherous conditions on the abrasive asphalt roads and M-Sport's Gus Greensmith can count himself lucky after surviving a huge scare.
The British driver ran wide on a wet right hander resulted in his Puma climbing a grass back, narrowly missing a tree in the process. Greensmith was able to gather the car up, losing only a front splitter.
Crews will complete three more stages before returning to service park in the centre of the Croatian capital Zagreb.
Rovanpera held a 4.1s lead over Hyundai’s Thierry Neuville, with M-Sport’s Craig Breen, 13s back in third.
