Chris Anderson and Joe Daley shot matching rounds of 65 to finish three shots off the pace at 10-under-par 134. They were joined by Adam Groom, Nathan Green and Robin Freeman in a tie for third.
Elliott parred the opening hole at Champions Run, but caught fire soon after with the first of four consecutive birdies starting at the par-5 second. Elliott stumbled to a bogey at the eighth, but recovered well with a birdie at the very next hole to make the turn at 10 under.
The 40-year-old, who owns two Nationwide Tour titles, added a birdie at the par-3 12th to move to 11 under.
Elliott then closed his round in style with birdies on each of his last two holes to stand atop the leaderboard through 36 holes of a Nationwide Tour event for the first time since the 2003 Knoxville Open.
Elliott actually credited some lessons he received from Barron for his fine play.
'I've been too stubborn to get lessons my whole life, but Doug has helped me with my wedge game,' Elliott said. 'I told him I'll buy him a case of wine if something good happens this week. We have good karma together. It would be nice to be paired together again.'
Barron, who held the opening-round lead, was unable to equal the 63 he fired in the first round. He collected a pair of birdies over his first nine holes, but found trouble early on the back side with two straight bogeys starting at the par-5 10th.
The 35-year-old responded with back-to-back birdies from the 12th and parred his way in to complete a round of 70.
'I did what I wanted to do today except put the score on the board,' said Barron. 'I hit about every green, but kept leaving myself hard putts. But I kept myself in the game.'
Scott Gutschewski, Mathew Goggin and Steve Runge share eighth place at 9-under-par 135.
The 36-hole cut fell at 4-under-par 140 with 79 players qualifying for the weekend. Among those who failed to qualify was 2002 U.S. Amateur champion Ricky Barnes.