Nikkei loses 3.1%
Japan's Nikkei 225 crashed to a seven-week low as investors eyed the sell-off in China.
Companies with high exposure to the mainland were among the hardest-hit; Komatsu slumped 5.8 percent, while Hitachi Construction Machinery retreated 4 percent.
Other casualties included Itochu Corp, which sank 9.2 percent, after the Nikkei business daily reported that its plans to buy a stake in Bosideng International Holdings was rejected by the Chinese apparel company's shareholders.
Nissan Motor closed down 6.6 percent to its lowest level since February 20 following the company's announcement of an abnormal deployment of an airbag made by Takata.
On the domestic data front, Japan logged its eleventh straight monthly current account surplus in May, with the surplus widening to 1.88 trillion yen ($15.36 billion), topping a Reuters forecast for a 1.54 trillion yen surplus.
ASX tumbles 2%
Australia's S&P ASX 200 index gave up all of Tuesday's gains, with banks and miners leading the downward spiral.
Among the four major lenders, National Australia Bank, Australia and New Zealand Banking and Commonwealth Bank of Australia pulled back more than 2 percent each.
As commodity prices tanked on the back of worries over a deteriorating outlook in China, the resources sector succumbed to selling pressure, with Fortescue Metals losing 6.2 percent to hit its lowest level since January 2009. BHP Billiton and Rio Tinto also shaved off 3 percent each.
Meanwhile, Santos and Woodside Petroleum sagged 3.3 and 2.9 percent, respectively, in tandem with weaker crude oil prices.
In reaction to the mayhem in Chinese markets, the Australian dollar hit a fresh six-year low of $0.7397 against the greenback.
Kospi eases 1.2%
South Korea's Kospi index tracked regional weakness to finish at its lowest level since June 16, chalking up a four-session losing streak.
Pharmaceuticals were among the biggest laggards, with Daewoong Pharmaceutical and Hyundai Pharmaceutical easing 3.7 and 4.2 percent, respectively.
Mirae Asset Life Insurance declined 2.2 percent to 7,240 won per share in its market debut on Wednesday. The initial public offering (IPO) had priced below an indicative range of 8,200-10,000 won per share.
Read MoreAirAsia hits major turbulence in Indonesia
Southeast Asian stocks eyed
Shares of Malaysian budget carrier AirAsia tanked more than 12 percent after Indonesia's transport ministry threatened to suspend the operating licence of its Indonesian affiliate unless the company raised new equity by end-July.
Meanwhile, Singapore Post closed 0.79 percent up to trade at 1.90 Singapore dollars, buoyed by news that Chinese e-commerce giant Alibaba Group plans to increase its equity stake in the Singapore-listed company. Following the news, OCBC held on to its 'buy' recommendation for the stock, with 2.19 Singapore dollars as a fair value estimate.