Kaye carded a 66, making all five of his birdies on the back nine, and second-round leader Phil Mickelson was one shot back after a 68.
The leaderboard for the final round will be packed with crowd favorites - DiMarco (2002), Mickelson (1996) and Vijay Singh (1995, 2003) are former Phoenix Open champions - and international stars such as Mike Weir, Bernhard Langer and Sergio Garcia.
Langer (66), Justin Leonard (66), Weir (68) and Ricky Barnes (68) were three shots off the pace, with Singh, Garcia, Steve Flesch, Fredrik Jacobson and first-round leader Scott Verplank at 203.
Leonard, who was 1 over after 12 holes, tied a Phoenix record by birdieing the last six, and Singh charged into contention with a remarkable 63 - matching the best round of this tournament and his winning score in the fourth round last year.
Singh had eight birdies to move within range of his 11th consecutive top-10 finish, the most since Greg Norman's 11 in 1993-94.
DiMarco, whose wife had their third child the first week of January, waited until the Bob Hope last week to start his season and then missed the cut. But he was 7 under through two rounds this time and was on target from the start, starting his chain of birdies with a 20-foot putt on the second hole. He had a short putt for birdie on No. 3, but holed a 15-footer on No. 6 and a 25-footer on No. 9.
DiMarco's other birdies were on the 12th, 13th and 15th holes.
Kaye, playing three groups behind, made a 15-foot birdie putt on No. 17 to pull into the tie, but wasn't able to hole a putt of similar length on the last hole for the lead.
Mickelson had one birdie in the first 12 holes, but was back in his element on Nos. 13 and 15, the two par-5s on the back nine.
He birdied both, two-putting from 26 feet on the 13th hole after a 327-yard drive, and two-putting from 35 feet on 15 after a 334-yard drive. That got him to 13 under.
But the former Arizona State golfer's touch deserted him down the stretch despite encouragement from a huge gallery announced at 148,521. Mickelson smiled as he walked down the 16th fairway, but missed a 10-foot birdie putt on the green.
Mickelson was 12-under before bogeying his last two holes Friday.
Nobody reached that level Saturday until DiMarco's birdie on the par-3 12th.
DiMarco chipped out of a bunker to within 6 feet of the cup on the next hole and birdied, opening a two-shot lead.
Divots: Arron Oberholser, who eagled two of the last four holes Friday to make the cut, eagled No. 15 for the second straight day and shot 66 for the round. ... Garcia hit five of his last six approach shots within 10 feet, converting twice for birdies. On the last hole, he sank a 14-foot birdie putt. ... Garcia noticed the 127 yards added to the course. 'At 9, I hit 7-iron. That's a hole we used to hit sand wedge into that green,' he said.
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