'I've got a lot of work tomorrow before I start thinking about that,' Mallon said. 'I'm seeing the line right now, and just trusting that and rolling it at the hole, and good things are happening.'
Defending champion Beth Daniel shot a 67 to finish alone in second place at 12-under-par 204. Lorena Ochoa and Dawn Coe-Jones were two shots further back at 10-under-par 206.
Mallon, who captured her second U.S. Women's Open title last week, regained her fiery form Saturday on the Battlefield Course at Legends on the Niagara with her second 65 of the tournament.
'The great thing about having experience and being out here a while is you've seen it all,' said Mallon, who won this tournament in 2002. 'You can't rest on last week's laurels because you have next week to play.'
The 41-year-old jumped out of the gate with a birdie at the first and began to pull away from her competitors with a birdie at the par-5 sixth. Mallon then birdied the par-4 seventh and made it three straight with a birdie at the par-3 eighth.
Mallon kept on cruising on the inward half with a birdie at the par-4 13th, a hole she bogeyed in the second round.
At the par-4 15th, Mallon dropped her approach inside 10 feet and converted the putt for another birdie. She added a birdie at the par-3 17th and with the way Mallon has been playing the last two weeks, her four-shot edge seems more than comfortable.
'There is no cushion, that's the mentality I've got to have,' said Mallon, who will try to become the first two-time winner of this event. 'I played really well today, very smart golf, very solid, and put myself in very good positions.'
Daniel became the oldest player to win this event when she took the title last year and the 47-year-old would surely like to do it again.
She stumbled with a bogey at the third, but recovered with a birdie at the sixth. Daniel then turned it on down the stretch starting with a birdie at the par-5 11th.
At the par-4 15th, Daniel picked up the first of four consecutive birdies to close out her round.
'My opinion is it's going to be very hard to catch Meg,' said Daniel. 'She's playing real well. Somebody is going to have to go really low if they're going to try to catch her tomorrow.'
Ochoa was playing well with a pair of birdies on the front side and an eagle at the par-5 11th that moved her to 12-under. The 22-year-old found trouble with a double-bogey at the 16th, however, to fall six shots off the pace after a round of 70.
Coe-Jones, playing in front of some very supportive galleries, collected three birdies and a bogey over her first nine holes. The Canadian then birdied the 11th on her way to a round of 69.
Aree Song, Gloria Park and Jean Bartholomew share fifth place at 9-under-par 207. Jennifer Rosales and Stacy Prammanasudh were one shot further back at 8-under-par 208.
Canada's Lorie Kane joined Mi Hyun Kim and Wendy Ward in a tie for 10th at 7-under-par 209.