Both players are competing here for the second straight year, but first as partners. Four teams are tied for second at minus-9.
U.S. Open runner-up Rocco Mediate teamed with Brandt Snedeker to post eight birdies, a bogey and an eagle to finish at 9-under 62.
There were tied in second place with Tim Herron and Paul Goydos; Davis Love III and Billy Andrade; and Nick Price and Charles Howell III. Andrade co-hosts this event with Brad Faxon.
Villegas and Watson birdied five of their first six holes, but the other was a bogey on the fifth. They eagled the par-5 eighth to jump to minus-6.
Around the turn, they birdied four of five holes from the 11th to jump to 10 under, but only parred the last three holes to finish there.
Brett Quigley teamed with his uncle Dana Quigley to shoot 8-under 63. They are tied for sixth with LPGA Tour players Nicole Castrale and Laura Diaz.
Stewart Cink, who won the Travelers Championship on Sunday, paired with local favorite J.J. Henry to shoot 65, where they are alone in eighth. One shot behind them is the team of Justin Rose and Nick Faldo.
Faxon paired with Peter Jacobsen for a 1-under 70. They are in last place.