Lee carded a masterful four-under-par 66 at Lancaster Country Club to reel in halfway leader Wichanee Meechai (67) and march ominously towards a second Open title in three years.
The 2022 champion can join the legendary Karrie Webb with two US Open crowns if she goes on to win a third career major championship outside of Philadelphia.
The world No.9 will enter the final round in a three-way tie for top spot at five under with Meechai and American Andrea Lee, who posted a 69 to remain in the hunt to parlay her immense potential into a maiden major on Sunday.
On pedigree, though, Australia's Lee will be the favourite to kick on after producing a dazzling stretch on one of golf's most challenging layouts to card her equal-lowest round at a US Open.
After six straight pars, Lee was four shots behind Meechai before igniting her round with a spectacular eagle three at the seventh.
An hour later, she only trailed by one after stamping a pinpoint nine iron to three feet on the 11th for birdie and following up with another laser-like approach on the treacherous par-3 12th.
With Meechai dropping her first shot in 15 holes after missing the 10th green, Lee suddenly grabbed a share of the lead after collecting another tap-in birdie at the signature par-3 12th.
Her own 22-hole bogey-free run ended on No.13 when she overcooked her approach and failed to get up and down from the back fringe.
But Lee bounced with a third back-nine birdie on No.16 to regain a slice of the lead.
The front-running trio hold a two-shot buffer over Hinako Shibuno, who matched Lee's tournament-low 66.
Fellow Japanese Yuka Saso, the 2021 champion, is a stroke further back in outright fifth.
While Meechai is hoping for a fairytale first LPGA Tour win from Monday qualifying, Saso may well prove Lee's biggest threat even from three shots back.
The gifted 22-year-old has struggled with her ball striking for much of the week but is leading the field with putting after draining a seemingly endless number of longe-range efforts.
Minjee Lee has surged to the top of the leaderboard at the US Women's Open. (AP PHOTO)
The $US12 million ($A18 million) tournament looks a race in five, with no other players under par.
At nine under after a third-round 72, Hannah Green is the next best Australian, tied for 39th some 14 shots off the pace.
Gabriela Ruffels (75) is tied for 73rd at 13 over.
