The twice champion at Melbourne Park had been battling a foot injury for two years, which combined with a plummeting ranking and the breakdown in a personal relationship had contributed to bouts of depression.
The 26-year-old, however, reproduced some of the tennis that had made her world number one over the last three weeks in Australia, with many tipping her as a potential winner of the year's opening grand slam.
She stormed to the Brisbane title, dispatching Kerber in the final, by dropping just 17 games over five matches.
At Melbourne Park, she lost just 11 games in the first four rounds and was hitting the ball as cleanly as she had when she won successive titles on the blue hard courts in 2012 and 2013.
"I think I've been playing pretty well," Azarenka told reporters. "Three weeks of good tennis, you know, solid effort.
"I'm in the right direction."
Her 6-3 7-5 loss on Wednesday, however, could be put down to "a bad day at the office" as she said, though it was more due to two periods of extreme hitting by the seventh-seeded German.
Kerber raced out to a 4-0 lead in the first set and then while facing three set points at 2-5 in the second, began to swing for the fences and reeled off winner after winner that left the Belarusian looking bereft as to what to do.
Despite being disappointed and while she may succumb to tears or, in a remotely possible outburst of anger, break something, the defeat would be put behind her by Thursday.
"It's going to be forgotten tomorrow. I have improved so much from last year," Azarenka said.
"Taking this three weeks I have to keep working hard. I've shown good signs. I've shown good quality, way more consistent, physically much better.
"But there is work that has to be done."
(Editing by Amlan Chakraborty)
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