'I'm thinking that it's not over until the fat lady sings,' said Kerr, who has 19 top-10 finishes in her career, including seven in the top-three.
'I have one day left and I do not want to relax until the final putt on 18. You hope that things go your way and no matter what I can handle anything that happens.'
Australian Jane Crafter carded a two-under 70 for solo second at six-under. Korea's Mi Hyun Kim and Hee-Won Han, winners of the LPGA Rookie of the Year awards in 1999 and 2001, respectively, finished tied with Heather Bowie at minus-five.
Kerr began the day at 6-under, two shots ahead of Crafter and Kim. She sank birdie putts of eight and 12 feet in the first four holes Saturday, then closed the front nine at Twelve Bridges Golf Club with a clutch par save from seven feet.
'It kept my round going,' Kerr said. 'It got the momentum going for the back nine.'
She broke into double-digits under par with back-to-back birdie putts in the 10-foot range at the 10th and 11th. After using a 4-iron to hit the green in two at the par-5 12th, Kerr two-putted for birdie to move to 11-under. Her only mistake came in the form of a three-putt bogey at the par-3 15th, but Kerr quickly recovered the lost stroke with a 10-foot birdie putt at the 16th.
Kerr, who notched one of her two career runner-up finishes at the 2000 U.S. Women's Open at the Merit Club, has a pair of third-place results this season. She wound up tied for third and two shots behind winner Annika Sorenstam at last month's Kraft Nabisco Championship, the first LPGA major of 2002.
'I have played in the last group in the last group on Sunday a number of times and I have been second and third,' said the 24-year-old Kerr. 'I hit it good in the final round on Sunday at Nabisco and so I am feeling pretty good about my chances.
'I know what to do tomorrow and I just have to execute it and not let myself get in my own way.'
Han bogeyed the first hole Saturday but collected four birdies over the next seven holes. Fine iron play set up her total of six birdies -- five from six feet or closer -- and helped her to the day's other 5-under-par 67.
Bowie turned in a 68. Kim, who tied for seventh here last year, shot a third-round 71.
Juli Inkster, the Longs Drugs Challenge winner in 1999 and 2000, shot her second straight 70 and was alone in sixth place at 4-under 212. Defending champion Se Ri Pak (72) was part of a tie for ninth at minus-one.
Full field scores from the Longs Drugs Challenge