Howell birdied his final two holes for a 6-under 65. He stands at 8-under-par 134, one shot clear of Nick Price, who chipped in from 90 feet for birdie at the last for a 67.
Defending champion Len Mattiace also had a 67 and is two back at 6-under.
Rich Beem is four off the pace after matching Howells 65. Overnight leader Fred Funk (74) made his way to 8-under, but played holes 12-15 in 5-over, to finish at minus-3.
Beginning on the back nine, Woods was 5-under on the day over his first 10 holes. But following five straight pars, he ran into trouble down the stretch.
Woods blocked his tee shot on the par-4 seventh into the right rough. With his ball buried in the foot-long grass, he was unable to advance it more than three inches.
'If I made contact there, it would have been a task. I went ahead and swung as hard as I could and I went right underneath it,' Woods explained.
From roughly the same position, he then turned over his third shot 100 yards left into a fairway bunker. He finally reached the green on his fourth shot, and two-putted for double bogey.
That knocked Woods from 4-under -- and within two of the lead at the time -- to 2-under.
He recovered with a 25-foot birdie at the eighth, only to bogey the ninth after coming up short of the green with his approach from an awkward stance in the bunker.
I really played well all day, just made a bad swing on No. 7 and, unfortunately, it cost me a couple of shots, said Woods, who is seeking his first win in his sixth start as a professional at this event.
Im in a really good spot. Anyone under par has a real good chance to win this tournament.
That includes Tigers two-day playing companion, David Duval.
As he did in round one, Duval scrambled for an under-par score. He hit five of 14 fairways and 10 of 18 greens in regulation, but still managed a 1-under 70.
He chipped in for the third time in two days and needed only eight putts on the front nine, his back.
He stands alongside Stephen Ames (69), K.J. Choi (69), Duffy Waldorf (69) and Funk at 3-under-par 139.
I have managed to hang in there, said Duval, who withdrew from last years final round due to food poisoning.
Like Duval, Price has had his share of success from off the green. He twice chipped in for birdie in the second round, at the sixth and at the 18th.
I missed a few short putts on 15, 16, 17, so I guess it all evens out, he said.
Price has won 18 times in his 21-year PGA Tour career, but is looking to accomplish a pair of firsts this week.
I have never won on the west coast and I have never won on poa annua greens, so this is a good chance to kill two birds with one stone, he said.
Price will play alongside Mattiace and Howell in Saturdays final threesome. This will be nothing new for the 46-year-old Zimbabwean. He regularly plays practice rounds with Howell, and has watched him play for over a decade.
Ive known Charlie since he was 10, Price said. 'He was skinny and hit more balls than I have seen a kid do in my life. And he hasn't changed.'
Howell started the day four back of Funk, and remained there when he glanced at the leaderboard on the eighth hole.
Fred was at 8-under and I was at 4-under, he recalled.
Howell birdied No. 8 to get to 5-under. And as Funk was melting on the back, Howell was burning up the par-5s. He reached the 11th with his second shot and two-putted for birdie. He then got up and down for birdie at 17.
He concluded his day by hitting a sand wedge on the 451-yard closing hole to 12 feet for sole possession of the lead.
Howell said he has turned over a new leaf in 2003, opting not to keep track of where he stands in the tournament.
I dont think anything good comes of that, he explained. Until the last four holes on Sunday I dont think its important.