The 22-year old is trying to win her first major after already capturing two titles this season in the Bahamas and Hawaii.
She opened the day one stroke ahead of Karrie Webb. But the Hall of Famer, who is seeking her eighth major championship, dropped two strokes on the first two holes.
Brittany Lincicome made a move up the leaderboard, making five consecutive birdies on the ninth through 13 holes. The 29-year-old American picked up a sixth on the 15th hole and had a birdie putt lip out on No. 17.
Canadian Brooke Henderson was tied in third place, three strokes off the lead.