First-round co-leaders Gil Morgan and Leonard Thompson shot matching rounds of 2-under 68 to join Bobby Wadkins (61), Morris Hatalsky (64), Larry Nelson (65) and Vicente Fernandez (66) at 9-under-par 131. Wadkins' 61 was his best round as a pro beating his best of 65 on the Champions Tour and 64 on the PGA Tour.
Dana Quigley and Tom Purtzer posted rounds of 4-under 66 to share ninth at minus-8.
Watson had sole possession of the lead with five birdies through 17 holes. He bogeyed the last to fall into a tie with Gilder at 10-under.
Watson rolled an eight-footer for his first birdie of the day at the par-4 fourth. He followed that up with tap-in birdie at the par-5 seventh.
Around the turn, he nearly holed an eagle chip but settled for a kick-in birdie at the par-5 11th giving him four birdies in four tries on the par-5s in the first two rounds of the tournament.
He later birdied the par-3 16th and followed that with another birdie at the next. Watson however faltered at the last after his drive found a fairway bunker and the bogey dropped him into a share of the lead.
'Nobody ran away from the field today. Someone's got to shoot a low round to win and I hope that's me,' said Watson. 'I only missed three greens. I felt like I was attacking the hole all day.'
Watson, who has never won in the state of Florida, will be in search of his fifth win on the elder circuit and so far in 2003, he has played well enough to win. He has a pair of top-5 finishes this season but Sunday could be the first trip to the winner's circle.
'I'd like to win in Florida. I'm 0-for-84,' said Watson, who was accounting for his time on the PGA and Champions Tours. 'This course is a good challenge and the wind compounds the challenge.'
Gilder mixed eight birdies and two bogeys for his round of 64. He ran off three straight birdies starting at the par-4 sixth and ending with a bomb from 60 feet at the eighth. However he stumbled with a bogey at the ninth to make the turn at minus-6.
After he wrapped birdies at 11 and 13 around a bogey at the 12th, Gilder was in the middle of the pack. He then ran off three birdies, all from within 10 feet, over his last four holes put him in solid position for his seventh Champions Tour victory.
'I am very satisfied the three-week break gave my back a rest. It had been hurting me,' said Gilder. 'It'll be a shootout tomorrow. You're going to have to go low again. I might need to shoot 7-under to win.'
Wadkins got going when he rolled in a 15-foot eagle putt at the seventh. He then knocked a 6-iron to within five feet for birdie at the ninth. Around the turn, Wadkins notched back-to-back birdies from the 11th and again from the 14th. He capped his stellar round by birdieing the final two holes.
'The eagle at the seventh got me going,' said Wadkins. 'I had nine one-putts today. That's the key to golf.'
Defending champion Dave Eichelberger rebounded from an opening-round 74 on Friday. He shot a 1-under 69 on Saturday but is still well out of contention at 3-over-par 143.