Donald's Ryder Cup teammate and fellow countryman David Howell is alone in second place after a third-round, 6-under 66. He finished 54 holes at 16-under-par 200.
Simon Kahn (68), Soren Kjeldsen (65) and Brett Rumford (69) are knotted in third place at minus-15.
Donald, who began the third round tied for the lead with Rumford, did not get off to the best start on Saturday. He bogeyed his first hole, then managed only pars for his next seven holes.
Things changed for the Englishman at the par-5 ninth. He almost did not go for the green with his second shot, but pulled a fairway-metal and hit it left off the green. Donald chipped in for the eagle and turned his Saturday completely around.
'I was really in between whether I thought I could get there or not,' admitted Donald. 'The wind died down and I didn't hit a particularly good shot. From there, I got the chip-in and that kind of got me kick-started.'
Donald snaked in a 15-foot birdie putt at the 10th to get within one of the lead Howell had. He added another birdie at the 11th, then joined Howell in first with a 5-foot birdie putt at No. 13.
Howell never got anything going after a birdie at the 12th, so Donald assumed the lead of the tournament with a birdie at the driveable, par-4 16th. He missed the green left off the tee, but got up and down for birdie to reach 17 under par and take the lead.
It was short-lived. Donald went long and left into a bunker with his tee ball at the par-3 hole. He blasted out 15 feet past the hole and missed the par putt on the left side.
At the par-5 closing hole, Donald, not one of the longest hitters on tour, found the fairway, but had to lay up short of the green. He knocked his third to 4 feet and drained the birdie putt to polish off a back-nine 32.
'I really struggled on the greens today,' admitted Donald, who will be in search of his first win on the European Tour in 2005. 'I've hit quite a few fairways this week and my iron play has been really good.'
Howell bogeyed No. 2, but then birdied three in a row from the third, including a chip-in birdie at No. 5. He tallied another birdie at eight, and made the turn with a birdie at the 10th.
Howell recorded back-to-back birdies with a 6-footer at the 11th, then made it three in a row with a 12-footer at the 12th. That birdie got him to minus-16, but Howell saved a beautiful par at the 14th from 7 feet.
He made three routine pars from the 15th, but missed a 3-foot birdie putt at the last that would have tied him for the lead.
John Daly, who won this title in 2001, was in first before the leaders teed off. He fired a 7-under 65 and is tied for sixth place at 14-under-par 202.
'Today was a good day, I got off to a good start,' said Daly, who won the 1995 British Open at St. Andrews. 'If I could putt better, I could go really low. I love the way I'm hitting it. If I get the putter going, hopefully something good could happen tomorrow.'
Daly is tied for sixth place with Ricardo Gonzalez, who shot a 4-under 68.
Angel Cabrera was in the clubhouse at 15 under par, but a rules infraction cost him two shots. His caddie walked through a bunker on 13, then raked his footsteps before Cabrera hit his shot.
That cost Cabrera two shots and gave him a 2-under 70 on Saturday. He shares eighth place with Bradley Dredge (69), Niclas Fasth (64), Paul McGinley (66) and Peter O'Malley (66).