The best-of-three dance move challenge came after Fallon had asked her three questions submitted to him on Twitter.
"What would you do if you came face-to-face with a bear in the woods and why?" resulted in a full-blown dance off between Diaz and Fallon.
Diaz, who looked super sexy in black satin trousers and high heels, gave Fallon the "talk to the hand" gesture and called him a "bi-atch."
In the end, Fallon accepted defeat: "You win, you win, you win." Check out the hilarious video below...