The 21-year-old shuttler from Hyderabad became only the second Indian woman after Saina Nehwal to break into the top-five of the world rankings by earning 75759 points.
She superseded Japan's Akane Yamugachi to make the number two spot.
Sindhu had recently bagged the India Open title after defeating Carolina Marin of Spain in the summit clash, but lost in the opening round of the ongoing Malaysia Open Super Series in Kuching.
Saina, who also lost in the first round of the Malaysia Open, however, lost a place to be at ninth position in the ranking table with 64279 points.
None of the male Indian shuttler figured in the top-10 list.