Morgan had just one blip on her card -- a bogey from a bunker on the par-4 14th -- but followed that with four birdies in five holes. Her 65 left her at 9-under 133, two better than Amy Hung, who had a 68 after making bogeys on two of her first three holes.
Carin Koch (69) and Jimin Kang, who matched Morgan for the best round of the day with her 65 on the 6,306-yard River Course, were tied for fourth at 6 under. Dorothy Delasin (68) and In-Kyung Kim (68), Stacy Prammanasudh (70), Natalie Gulbis (70), Brittany Lincicome (71) and Birdie Kim (72) followed at 5 under.
Lee's nerves, elevated after waves of people congratulated her on her course-record tying 63 in the first round, lasted only until the first shot.
'A good nervous,' she called it.
She was tested again after she made the turn, but she was ready by then. She drove into a fairway bunker off the first tee, having to lay up and get up and down from 50 yards. After a birdie at No. 3 -- her 12th hole of the day -- she hit into another bunker off the tee on the par-4 four, laid up to about 60 yards and got up and down again.
At the par-5 seventh, she pulled her second shot hard to the left, leaving her with a highly elevated chip on what she guessed was a 70-degree incline. She remarkably hit that to about 12 feet and two-putted, happy to escape again without any damage.
Seeking her first victory in her 124th event, Lee did better than she had in 2004, when she followed her career-best 60 by shooting even par in Tucson, Ariz., and better than she did last year at the Safeway International at Superstition Mountain, Ariz., when she led after the second and third rounds, but faltered to second on Sunday.
'I don't want to talk about my past,' she said when asked about the Safeway loss last year, 'but, you know, that time, I hit it great. I played all the time just steady, good round, but just one bad hole got me and Juli Inkster won.'
This time around, Lee said, 'I know what I'm doing.'
Morgan did, too, once the club that used to be her favorite came around again.
'The last couple of weeks, putting has come good again, and I finally put it all together,' she said. 'It's nice to be up there again.'
Morgan has made 139 career starts without winning on the LPGA Tour.
Kang, one of the most upbeat players on tour, is still working back from a stress fracture last October, and said everything clicked. She hit 17 greens in regulation Thursday and shot even, then made five birdie putts between 12 and 24 feet Friday.
'It's good to know I got potential playing golf out here,' she joked.
With weather that was threatening in the late afternoon but nearly as benign as for the first round, other challengers seemed to start to make charges, then faded.
Cristie Kerr, the 2005 champion, got to 4 under after four holes, but managed just one more birdie and a bogey the rest of the way. She finished at 4 under after a 69.
Paula Creamer was 5 under with seven holes left, but left her approach way right on the par-5 third, took bogey, and added another bogey en route to a 69 and a 3-under total.
Morgan Pressel, too, got to 5 under by nearly sinking her approach to the par-4 first, leaving a tap-in birdie, but was 2 over for her last eight holes. She shot a 72 to finish at 3 under. Top-ranked Lorena Ochoa also was 3 under after a 69.