Defending champion Annika Sorenstam, who officially became a member of both the LPGA Tour and World Golf Halls of Fame after her first round Friday, carded a 4-under 68 on Saturday and is alone in fourth place at 9-under-par 207.
Teske played an average front nine at the TPC at The Woodlands as she made the turn in 1-under-par 35 and got to 6 under for the championship. She knocked her approach on No. 11 to two feet to set up birdie and get within one shot of the lead that Daniel, her playing partner on Saturday, held.
Teske sank an eight-footer for birdie at the par-3 14th to tie for the lead with a large cast of players but fell behind Daniel at the 15th when Teske made birdie and Daniel holed an eagle putt from the fringe.
The Australian drew even with Daniel at minus-10 one hole later when she holed out for a birdie from a greenside bunker. Teske hit a 7-iron over the stick at 17 but missed her birdie chance. Daniel could not pull ahead at the hole despite having a shorter birdie putt.
At the 18th, Teske played her second shot to four feet while Daniel pulled her's 20 feet left of the stick. Daniel missed her putt and Teske cashed in on her try to go one ahead of her Hall of Fame partner.
But Pak remained on the course and within striking distance.
Pak, who led after both the first and second rounds, birdied the first hole Saturday but parred her next 12 holes. She hit her tee ball to four feet at the par-3 14th and rolled home the birdie putt to reach 9 under par for the tournament.
Pak seemed to be in trouble at the par-5 15th when she sailed over the green with her second. She elected to pitch into a hill and try and roll the ball toward the hole but it got stuck on the fringe. Pak was able to two-putt from approximately the same distance as Daniel's eagle try and save par.
The No. 2 player in the world hit another beautiful iron shot at the par-3 16th and once again sank a short birdie putt to tie for the lead at minus-10.
Pak had a pair of seven-footers for birdie at the final two holes but missed on both opportunities and settled for a 3-under 69.
That gave Teske her first 54-hole lead since the event in Rochester this summer, the second of her back-to-back wins this summer.
Daniel carded a 5-under 67 on Saturday and already has the record for oldest winner in LPGA Tour history. A win on Sunday would just change the numbers in the record book.
But neither of the three players ahead are forgetting about Sorenstam, who tied for the lead after a 20-foot birdie putt at the 14th. She ran home a seven-footer for birdie at the next hole to keep pace but parred her final three holes, including a near birdie at 18, for her 68.
'I made some good putts today,' said Sorenstam, a five-time winner on tour this season. 'I thought I played really good. On the back nine, I really tightened my swing and had a lot more birdie chances.'
Sophie Gustafson (69) and Juli Inkster (70) share fifth place at minus-6, followed by Cristie Kerr and Lorie Kane, who shot matching 70s on Saturday, to tie for seventh at 5-under-par 211.
Meg Mallon (70) and Grace Park (73) share ninth at minus-4.