At 10-under 132 through 36 holes at the Mississauga Golf and Country Club, Thorpe leads by two shots over Walter Hall (66) and by three over four others including Bruce Fleisher and Mike Smith, each of whom shot 66 as well.
While he carded a season-best 63 Thursday, it was a bit of a different game on Day 2 for Thorpe.
Following back-to-back birdies over his first two holes of the day, it seemed the 52-year-old might run away with the event, but he gave the shots back just as quickly with bogies on Nos. 4 and 8.
Meanwhile, Hall took advantage of the lag, making six birdies on his round, with his lone blemish coming at the par-3 6th.
Thorpe managed to salvage his round, however, as the two-time winner in 2000 got the shots back on the final nine holes, nailing birdies at the last two par-5s, Nos. 12 and 13.
While he has yet to find the magic of last year, Thorpe has been close all year.
Four times in 2001, he has ended in the top-3, his most dramatic moment coming in the Senior PGA Championship, when Tom Watson just edged him out for the title.
Full-field scores from the AT&T Canada Senior Open Championship