The Australian star, playing in difficult afternoon conditions with the ocean breeze up on the Hyatt Regency resort course, had a 10-under 134 total.
'It was pretty solid stuff, good ball-striking,' Scott said. 'It was pretty tough out there in the wind. I played rather well.'
South Africa's Rory Sabbatini and Australian Peter Lonard, who both played in the morning, were tied for second at 9 under. Sabbatini shot a 67, and Lonard had a 69.
Australians Cameron Percy (66) and Scott Laycock (67) and New Zealander David Smail (69) were another stroke back. Australian Michael Sim, who led by a stroke after the first round, was four strokes behind after a 72.
Scott birdied the par-5 15th after a great recovery shot from off the green to take a one-stroke lead, then birdied 16 with a 12-foot putt.
But he bogeyed the 17th after hitting his approach into a bunker and missing a 12-foot putt for par, the ball shaving the right side of the cup.
Playing in the same group over the first two days, Sabbatini, who planned a trip to nearby Australia Zoo on Friday afternoon, and Lonard were critical of their games.
'All things considered, I'm scoring well but not very happy,' Sabbatini said. 'I've driven the ball well but just made too many mistakes from there.'
Lonard made three mistakes Friday -- his first bogeys on the course since 2005.
Lonard had six birdies as well, but his bogey-free streak that stretched back to sixth hole of the final round of the 2005 Australian PGA ended. Lonard lost in a playoff last year to Nick O'Hern, who chipped in from a bunker on the fourth extra hole.
'I knew I hadn't bogeyed one for three years or whatever,' Lonard said. 'I knew I didn't muck up anything last year.'
Lonard said he should have done better Friday.
'It wasn't very good, I really never got it going,' Lonard said. 'They were perfect conditions, there was no reason not to hit a good score today.'
Percy's placing among the leaders was a surprise considering he had to use borrowed clubs in the first round Thursday. He left the U.S. PGA qualifying school tournament in Florida late Monday and arrived in Brisbane north of here early Wednesday, minus his luggage and clubs.
He was forced to play in clothes he had to wash several times over three days, and borrowed a bag, clubs, shoes and balls for his first round, when he shot 70.
'I played so conservatively because I didn't know the clubs and how they were going to react,' Percy said.
His suitcase full of clothes and Christmas presents and clubs arrived early Friday morning in time for his second round.
Missing the cut of even-par 144 was Stuart Appleby, who opened with a 78 and shot 71 Friday, and American Brandt Snedeker, who shot 72 Friday to finish at 2 over.