The Fort Worth, Texas, native, in her seventh professional season, has a total of 10-under 134, two shots better than McDonald's LPGA champion and world No. 2 Yani Tseng (68) of Taiwan.
"We have the greatest players in the world here, so I know that I have to keep going," said Stanford, who picked up her second career win Sept. 14 at the Bell Micro LPGA Classic at Mobile, Ala.
South Korea's Meena Lee (69) is third at 6-under 138, while at 5-under 139 is Karen Stupples (71), the only other player within five shots of the leader.
Retiring Annika Sorenstam, one of eight first-round co-leaders, shot 72 Friday and leads a group of six players tied for fifth at 4-under 140.
Tournament host and Guadalajara native Lorena Ochoa (71) is 10 shots back at even-par 144.