The 62-year-old Irwin, in position to become the third-oldest winner in Champions Tour history, matched Smyth (64) and Morgan (65) at 9-under 135. The three leaders played the Del Monte course Saturday after opening at Pebble Beach.
'The competitive urge is still there and the desire to excel is still there,' said Irwin, the tour leader in victories (45) and earnings ($30,260,086). 'I have to admit that these kids who are playing here are great to be with and they give you that extra snap, that extra pace that is really helpful to show where you started.'
The three-time U.S. Open winner won the MasterCard Championship in January.
Mike Fetchick is the player to win a Champions Tour event, taking the 1985 Hilton Head Seniors Invitational on his 63rd birthday. Gary Player is the second-oldest, winning the 1998 Northville Long Island Classic at 62.
Smyth, who began the day trailing leaders Morris Hatalsky and Bruce Vaughan by six strokes after an opening-round 71 at Pebble Beach, had nine birdies, including seven en route to a final-nine 29.
'I wasn't too happy with my first nine holes. I was just 1 under at the turn, but I caught fire on the back nine,' said Smyth, who has three top-10s this season but hasn't won since his two Champions Tour titles in 2005. 'I've had some problems with my swing this year, but my putter was red hot red today.'
Irwin, who began the day five strokes back, and also had a nine-birdie round.
Morgan, who lost in the record seven-man playoff last week in the Boeing Classic outside Seattle, made 3-foot birdie putts on the final two holes and had eight birdies.
Hatalsky (72), Lonnie Nielsen (69), Tom Watson (70) and Joe Ozaki (65) were tied for second at 7 under.