The Australian had a 54-hole total of 8-under 211 on the 7,665-yard Barseback Golf Club course ' the longest in European Tour history.
He was five shots behind second-round leader Ricardo Gonzalez of Argentina, and now has a one-shot lead over Jeppe Huldahl of Denmark (70), Martin Erlandsson of Sweden (72) and Lee Slattery of England (75).
Fraser, who turns 31 Sunday, is looking for his second European Tour victory. His first win came in the Russian Open six years ago.
Gonzalez slipped to a 77 and dropped to fifth with Marcus Higley of England (70).
Henrik Stenson, a Barseback member who will move to fifth when the world rankings are updated Monday, bogeyed seven of the first nine holes and finished with a 79. That left the Swede tied for 75th among the 78 players who made Fridays cut.