Woods' four-under effort gave him a 17-under total of 199 and maintained his four-shot lead over US Open champion Graeme McDowell.
After a bogey at the par-five second, Woods rebounded with three birdies in a row from the par-five fifth.
He put an exclamation mark on his round with an approach that left him a tap-in for his sixth birdie of the day at 18. Northern Ireland's McDowell also carded a 68 for 203.
The next closest rival in the 18-man field was England's Paul Casey, who carded a 69 for 207.
"I'm excited about tomorrow because of the way I'm playing," said Woods, whose last victory was at the 2009 Australian Masters.
In 2010, his struggles on the course have mirrored the personal travails that saw his marriage end.
Although this unofficial event that Woods hosts for the benefit of his charitable foundation wouldn't give him a PGA Tour title, it is worth world rankings points and could provide a valuable boost as he heads into 2011.
Certainly over three days of play in rolling country west of Los Angeles, Woods has looked more like a 14-time major champion than he has all season.
"To be honest with you, I don't look at it that way when I'm out there playing," Woods said of the chance to end his drought with a wire-to-wire victory.
"It's just that I'm in the moment, trying to put the golf ball on the different sides of the fairway, where I need to put it on the green. I just play."
Woods has won the title here four times, but missed last year as a sex scandal exploded around him and missed the year before as he recovered from knee surgery.
As Woods bogeyed the second, where his approach found the creek left of the green, McDowell notched a birdie, then picked up another shot at the par-three third to narrow the deficit to one stroke.
But Woods got things going with a birdie from a bunker at the par-five fifth, drained a 20-footer for birdie at six and made a short birdie putt at the seventh.
Woods led by five at the turn, but found it far from smooth sailing coming in.
"Today's back nine was certainly interesting," said Woods, noting that three holes had the potential to produce a two-shot swing.
At the 11th, Woods was on bare ground under the canopy of a tree but still reached the green in two and made a two-putt birdie that kept him four in front of McDowell, who had gained a shot at 10.
McDowell managed to save par at 13 despite hitting out of bounds, and on the next hole Woods made a key 18-footer to save par as McDowell was unable to birdie from six feet.
Although Woods has never lost a tournament when leading by three or more strokes after 54 holes, he was far from complacent.
"I've got 18 more holes, and it's a process," he said. "I know that we potentially could have some weather coming in here tomorrow, so got to be ready for that."
But Woods - who says he has been making steady, if painstaking, progress since August with the swing changes he is implementing with coach Sean Foley - was looking forward to the challenge.
"I'm excited about tomorrow because of the way I've been playing," he said. "I'm excited how I've been hitting the golf ball and how I've been managing my game around this golf course. This is going to be a fun test tomorrow."