The Cannondale rider from Slovakia, who is among the favourites to win overall title, also won the prologue time trial on Tuesday and leads the overall classification by 23 seconds.
"Today my team did a very good job because today was all day on the front," Sagan said. "And, also from the start there were attacks and we put only four riders in the breakaway. Then we were always on the front for the pulling."
Sagan won Wednesday's sprint finish, posting a time of three hours 22 minutes 17 seconds and earning the 10-second winner's time bonus to retain the yellow jersey with an overall time of 3:30:35.
Rohan Dennis of Garmin Sharp is second overall while teammate Ryder Hesjedal of Victoria moved up a spot to ninth, 40 seconds behind Sagan.
Hesjedal finished 19th Wednesday with the same time as Sagan.
BMC Racing's Cadel Evans, the 2011 Tour de France champion and another rider considered to have a chance at the first-ever Tour of Alberta podium, is fourth 30 seconds back of Sagan.
Regina's Rob Britton is the top rider on the Canadian national team, 1:10 off the pace.
Wednesday's 158-kilometre stage moved north along Edmonton's refinery row, then looped back south through rolling parkland to end in Camrose.
The race cycles through prairies, badlands and foothills before ending up in downtown Calgary on Friday for a total 900 kilometres of racing.
The Tour is the largest and most highly ranked bike race ever held in Canada. It involves six top-ranked teams from the European Pro Tour and eight teams from the Continental tour, as well as the Canadian national team.
Its 117 riders include 11 winners of single stages or one-day events, five current national champions, two world champions and two major European tour winners, including Hesjedal, winner of the 2012 Giro d'Italia.