Mickelson had three birdies and an eagle before bogeying the last two holes.
His 36-hole score of 10-under 132 was just beyond the reach of Jonathan Kaye, Jeff Sluman and first-round leader Scott Verplank.
'It could have been a really good day, but it's close enough to where a good round tomorrow will give me a chance,' said Mickelson, who was winless in 2003 and wound up a career-low 38th on the money list after three years of finishing second.
The left-hander also led with two rounds to go at the Bob Hope, which he won Sunday for his 22nd title, and has been in the 60s all seven rounds this year.
'I feel very comfortable with the way I'm playing, which I haven't had in a long time,' Mickelson said.
Verplank started one shot ahead of Mickelson and was up by that margin after 16 holes before also finishing with consecutive bogeys. That threw him back with Sluman, who carded a 67, and Kaye, who shot 68.
Masters champion Mike Weir finished the first round Friday morning with a par-saving, 11-foot putt for 65. Then he played the second in 69 to stay within two shots of the lead. He was joined at 134 by Ricky Barnes (67).
Seventy players made the cut at 142 - a sign the course was toughened by lengthening some holes. Last year's cut was at 4 under.
Three-time Phoenix winner Mark Calcavecchia and Paul Azinger, the 1987 champion, shot 66s and easily got in the final field as part of an eight-golfer group at 137.
Defending champion Vijay Singh, a two-time winner, carded a 69 for 140 - in the money by two strokes, and in position to try to extend his run of 10 consecutive top-10 finishes.
Chris DiMarco (2002), Jesper Parnevik (1998) and Lee Janzen (1993) were other Phoenix winners who got in, but Rocco Mediate, the 1999 medalist, was out after back-to-back 72s.
Mickelson birdied the fifth hole with a short putt and the eighth with a 45-footer from the fringe.
But the former Arizona State athlete drew the biggest roar from the gallery with a drive of more than 360 yards on the par-5 13th, followed by a 5-iron shot that stopped within 3 feet of the cup.
Mickelson holed the eagle putt, dropping to 11 under.
Two holes later, he birdied No. 15, a par-5 lengthened by 57 yards last year as part of a PGA effort to toughen the course, for the second straight day. This time, he laid up short of the water encircling the green and dropped a deft wedge within 7 feet.
Mickelson's strength went against him on Nos. 17 and 18, where he drove into bunkers on the right side of the fairway.
He reached the 17th green in good shape, but three-putted, and lost another stroke to par when he chipped onto the final green in three and two-putted.
'I thought I might be able to get the last two birdies and shoot the same score as yesterday (64),' Mickelson said. 'Instead, I followed with two bogeys and shot 68. It's a disappointing finish.'
Verplank played 20 holes of the event without a bogey, then bogeyed two of the next three.
Usually a finesse player, he finished with only seven pars after birdieing six holes and bogeying five. On the last two holes, Verplank missed both greens and two-putted after chips.
'Yesterday was pretty consistent and pretty pain-free, and today was kind of up-and-down,' Verplank said. 'Just hit a good shot, hit a bad shot - that kind of deal - and it wasn't as rhythmic.'
Divots:@ Singh's string of top-10s is the best since Greg Norman had six straight at the end of 1993 and five more in 1994. ... Jose Maria Olazabal, a two-time Masters champion, was 1 under through seven holes in the second round before withdrawing because of a rib injury. For the tournament he was even. ... Friday's attendance, derived by counting vehicles and multiplying by 3.1, was 113,088, second-largest ever for the second round.
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