Otago beat Taranaki by an impressive 4 to 1 margin in the morning round but went down after a tight tussle with Waikato by 2 to 3 in the afternoon.
Despite the loss, Otago remains in good shape to make the semifinals on Saturday morning as all of the teams in its division have suffered a loss.
Bay of Plenty looks unlikely to make it four in a row having lost to Manawatu-Wanganui and Taranaki two of the lowly-placed teams in last year's event.
Otago's fate lies in its own hands as, after playing Auckland today, the team will meet Bay of Plenty and Manawatu-Wanganui in the final section matches tomorrow.
Brent McEwan (No 1) was unbeaten yesterday and was always ahead to beat Brad Hayward by 3 and 2 in the morning.
In the afternoon he looked set to make it two wins at one up playing the final hole but Mat Perry was on the back of the green for two making birdie while McEwan missed a 2m putt and had to settle for par.
Otago No 2 Duncan Croudis has three wins from as many outings and is oozing confidence.
He beat Steven Heyes in the morning and downed the experienced Aaron Leech by 2 and 1 in the afternoon.
Michael Smith at No 3 did not have one of his best days losing to Tim White in the morning and finishing with bogeys to lose to Tane Robson in the afternoon.
Hamish Ireland played some of his best golf in the morning to down Taranaki No 4 Aarun Langton in 16 holes.
He faced sterner opposition in the afternoon and found himself one down to Compton Pikari playing the final hole.
Pikari obliged by three putting the final green and Ireland got out with a half.
At No 5, Simon Hollyer was one down with four holes to play but won three in a row including two birdies to win by 2 and 1.
But in the afternoon he suffered a different fate when Luke Toomey (Waikato) birdied the final hole to take the match.
Auckland and North Harbour are the only unbeaten teams after the second day, while none of the 15 district teams has won all its games after four rounds.
Auckland leads division one after a half against Tasman in the morning before being pushed to beat Taranaki 3 and 2 in the afternoon. while Otago is second on two wins, ahead of Manawatu Wanganui on a countback of games, but all eight teams in the section cannot be counted out.
North Harbour leads division two with two wins and a half.
It played its get-out-of-jail card to retain its unbeaten record.
Harbour earned a half against Canterbury after the experienced Scott Johnson holed out with a four iron from 180m for a par on the 18th, while his opponent Mark O'Malley lipped out with a birdie putt from 3m.
It gave Johnson the most unlikely result and his team a crucial half.
Aorangi is second on two wins and 11 individual games, on countback from Wellington and Hawkes Bay with only winless Poverty Bay out of the running.
Southland enjoyed a superb day, following its easy win over Poverty Bay, with an upset of South Island rival Canterbury 3 1/2 to 1 1/2.
Today's single round looms as a pivotal round, with key clashes between Wellington and North Harbour, Auckland and Otago, Manawatu Wanganui and Taranaki, Canterbury and Aorangi and Bay of Plenty and Tasman.
