Despite his only bogey in the first two rounds, the 34-year-old known as the 'Japanese Tiger' had a 4-under 67 and a one-stroke lead going into the weekend.
'I'm very happy and surprised to be in front,' he said through a translator.
Taniguchi was at 133, one stroke ahead of Jesper Parnevik, Len Mattiace, Brad Faxon and Scott McCarron.
Faxon had a 67 at Riviera Country Club, scene of his greatest PGA Tour round in 1995, when he had a 28 on the front nine and closed with a 63 in the PGA Championship to earn a spot on the Ryder Cup team.
McCarron, who played Riviera about once a month while going to UCLA, drove the 305-yard 10th green and holed a 36-foot eagle putt on his way to a 65.
Parnevik had six birdies and four bogeys in a fun-packed round of 69, while Mattiace birdied his last four holes for a 65.
Bob Tway had a 68 and was another stroke back, while David Duval showed once again that nothing beats a clear head. He has a history of performing well after taking time off, and a 69 on a clear, breezy day off Sunset Boulevard left him only three strokes back.
'This tournament always seems to have guys bunched up,' McCarron said.
And just about everyone was still in the picture. Those who made the cut were only nine strokes out of the lead. That includes Robert Allenby, who had a 66 and was at 139. He avoided becoming the fifth straight defending champion to miss the cut.
Sergio Garcia had a 67 and was at 140.
They refer to Taniguchi as 'Tiger' on the Japanese Tour because he pumps his fist whenever he makes birdie and prefers to wear red shirts on Sunday. His results bear no likeness to Tiger Woods.
Taniguchi has won only three times on that circuit, and he hasn't won since 2000.
Still, he is one of several Japanese players who is slowly emerging on the global scene. A year ago, he finished third in the Match Play Championship in Australia after losing 2-and-1 to eventual champion Steve Stricker, then beating Ernie Els in the consolation match.
Not many recall his third-place finish in a World Golf Championship event. A victory in the Nissan Open would be another matter.
'America is the top tour in the world. All the players are in the top class,' he said. 'That's a big difference from Japan. I'm satisfied winning Japan, but not totally satisfied. I'm trying to win in the U.S.'
Taniguchi described himself as a steady player who can be aggressive, and he used that combination well. His only birdie putt longer than eight feet was a 25-footer on No. 15, and his only bogey over the first 36 holes came when he missed the green long on No. 18.
Taniguchi is playing on a foreign exemption, and typically plays the West Coast events when possible because he is familiar with the courses.
No one gets vibes quite like Faxon.
'I played the best round of my life - ever - here in '95,' he said.
The better explanation for his 67-67 start was seeing his swing coach in San Diego before coming to Los Angeles, just like he did last year at the start of a season in which he won the Sony Open in his second tournament.
'I'm ready to play like I was at the beginning of last year,' he said.
It helped that Faxon managed to get a few extra hours of sleep. This is his second tournament since daughter Charlotte was born Jan. 18.
He also has developed a knack for holing shots from the fairway this week. On Thursday, it was a 70-yard pitch from the 11th fairway for eagle. On Friday, he got a boost by hitting into the bunker on No. 7, coming up short of the green and holing a 40-yard chip for birdie.
News, Notes and Numbers
*Jeff Maggert was disqualified when he bent his putter out of frustration on the 18th hole, then tapped in for bogey. One problem. Under Rule 4-3b, a player may not use a club that is damaged other than in the normal course of play when its characteristics have been altered. The penalty is disqualification.
'I thought it was a two-stroke penalty, but then I got to thinking about and called a rules official over,' Maggert said. 'The way I've been putting, maybe a new putter is what I need, anyway.'
*The Nissan Open is raising its purse next year by $800,000, making total prize money $4.5 million. There also will be a name change. While Nissan remains the title sponsor for at least four more years, Countrywide Credit Industries will be the presenting sponsor.
*Duval is playing for the first time with a bimatrix shaft in his driver. The shaft is a combination of steel by the clubhead and graphite.
Full-field scores from the Nissan Open