Lee shot a remarkable nine-under par 62 to leap 20 places up the leaderboard and put him just two shots off the pace going into tomorrow's final round.
Lee - who sits in outright second - will find his main competitor to be young sensation Jordan Spieth, winner of the last two majors and Lee's playing partner in the first two rounds.
Spieth went one better than Lee, finishing at 10-under for his round, eagling the par five 17th before birdieing his final hole to shoot a 61.
Lee birdied his first three holes, adding another at the sixth before then stringing together birdies on four of his first five holes on the back nine. Bogey-free, Lee also added to his round with a birdie at 17 to finish with the second best round of the day, and set up another pairing with Spieth.
Another strong finish would move Lee further up the world rankings and boost his chances of playing in the Presidents Cup, while his career-best form is also an excellent sign going into the Open Championship at St Andrews.
Americans Shawn Stefani, Justin Thomas and Johnson Wagner are tied for third at 14-under while 2007 Masters champion Zach Johnson and Daniel Summerhays are at 13-under.
Fellow Kiwi Steven Alker is also in the hunt for one of his best finishes of the year, sitting in a tie for 20th at nine-under. Alker slipped down the leaderboard this morning, shooting just one-under for his round.
Tim Wilkinson shot an even-par 71 to remain at five-under for the tournament, in a tie for 45th.
