Thomas Bjorn, who was the winner here in 2001, was one shot off the lead at 9-under-par 135 alongside Ian Woosnam.
Els, who has already won twice on the European Tour this season, held the lead late into the round until a blunder at the par-5 last. The South African went for the putting surface in two but watched as the wind caught his ball and sent it into the water that protects the 18th green en route to a bogey.
'I took a bit of a chance on the 18th and it didn't work out,' said Els. 'The only bad shot I hit on the back nine was on the 18th and I didn't quite get the 4-iron. But I hit the ball really nicely, almost better than yesterday, but it didn't quite go my way scoring-wise.'
Els, who earned his first career victory on the European Tour at this event in 1994, carded two birdies on the front nine of the Majlis Course at Emirates Golf Club and added a birdie at the 10th to reach 9-under.
At the par-5 13th, Els dropped his third shot within five feet of the cup for birdie and took the lead with a 10-foot birdie at the very next hole.
He was in command until the bogey at the last dropped him back to minus-10, but the three-time major winner has moved into a position that has been familiar to him for much of this year.
Forsyth, who held the outright lead after the opening round, birdied the third and ran home a 20-footer at the ninth to move to 9-under. He grabbed a share of the lead momentarily with a birdie at the 10th but stumbled with a bogey at the 13th.
The 27-year-old, who earned his first career victory on the European Tour at last year's Malaysian Open, recovered at the par-4 16th. He left his second shot 12 feet from the hole and drained the putt to secure his part of the 36-hole lead.
'Today, I felt a few holes were sloppy,' said Forsyth. 'I missed a lot of fairways but I was pleased with the way I scrambled on the front nine. Now I am looking forward to the weekend. There's a lot to play for and it is well bunched.'
Ilonen of Finland was on fire early with five birdies to assume control of the lead at 11-under. He bogeyed the last, however, for a round of 67.
Lynn used an amazing stretch of holes to close his round and grab a share of first. He stood at 7-under through 16 and picked up a birdie at the 17th and an eagle, his second of the day, at the last for a round of 66.
'I'm hitting it well. Just telling myself to get on with it and certainly score well,' said Lynn. 'It's great at the start of the year to get into contention.'
Ian Garbutt of England had the low round of the day with a 9-under 63. He was joined by fellow countrymen Nick Dougherty and Greg Owen as well as Germany's Sven Struver in a tie for seventh at 8-under-par 136.
Miguel Angel Jimenez and Kevin Na were one shot further back at 7-under- par 137.
The 36-hole cut fell at 1-under-par 143 with 80 players qualifying for the weekend. Among the casualties were Andrew Coltart and Sam Torrance.