"It feels good," said the one-time world No1. "I played well. I putted much better than I did yesterday, which was a big positive, and I'm in a great position going into the weekend.
"It would have been very easy for me to get frustrated yesterday and I was getting a little frustrated because I bogeyed 10 and 11 to go back to even par and I'm thinking to myself: 'I'm 10 behind - not just 10 behind anyone - I'm 10 behind Scotty."'
Veteran left-hander Richard Green is outright third at nine-under after vaulting into contention with a 66 punctuated by a spectacular hole-in-one on the 143-metre sixth.
"I haven't hit shots like I have the last two days for a long time, probably about three years," Green said.
"It's building, confidence is building and fortunately that shot on the par-3 sixth today was just a flush golf shot."
Matt Jones (68) is fourth at eight-under, one ahead of Leigh McKechnie, who matched McIlroy's 65, Alistair Presnell (68) and Josh Younger (69).
World Cup winner Jason Day (74) struggled and will start the weekend a dozen shots off the pace.
Exciting teenage amateur Ryan Ruffels fought back doggedly after a five-over 77 on debut on Thursday to make the halfway cut with a superb second-round five-under 67.
"I am really proud of myself," the 15-year-old said.
"I was pretty nervous coming into today because I didn't want to embarrass myself. It was pretty embarrassing yesterday."
Defending champion Peter Senior, who signed off for a nightmare 81 yesterday, was among several former winners to miss the cut. Greg Chalmers and Peter Fowler also failed to survive, while American drawcard Kevin Streelman was another casualty.
Streelman quit after four holes on Friday and required hospital treatment for a nasty eye infection.
- AAP