Chris Smith, Jeff Brehaut, D.J. Brigman, Sebastian Fernandez and Kelly Grunewald were one shot off the lead at 5-under 67, with nine players another stroke further back at 68.
There were 61 players overall within five shots of the co-leaders.
Lyle posted seven birdies with just one bogey in his round, finishing with a birdie at the 18th hole for his share of the lead. On Sunday, Lyle tied for 48th at the U.S. Open after four grueling rounds at tough Torrey Pines.
Fox Den Country Club was more hospitable.
'I guess we're back to the normal kind of golf after the circus last week,' said Lyle. 'I'm still really tired.'
Atwal, the first Indian player to win on the European Tour when he claimed the Singapore Masters in 2002, took two weeks off from playing before he returned on Thursday with a round that included six birdies and 12 pars.
He enjoyed the down time.
'I sat on my couch, played with my kids and spent time with my family,' said Atwal, who was also the first Indian player ever to earn a PGA TOUR card.
Among the co-leaders, only Kirk finished without a bogey Thursday. He collected three birdies on the front nine, an eagle at the par-5 10th and another birdie at the 16th for his 66.
The 23-year-old rookie needed a birdie at the 18th to take sole possession of the lead, but he flew the green on his approach. It was the only green he missed all day, and Kirk walked off with a par instead.
'I guess I misjudged the yardage somehow,' said Kirk. 'It's a new lob-wedge and it went 10 yards further than I thought.'
Greg Chalmers, Chris Anderson, Bob May, Wade Ormsby, Reid Edstrom, Tom Johnson, Matt Weibring, Scott Gardiner and Scott Gutschewski were tied for ninth place at 68.