Grace credited a practice round with British Open winner and fellow South African Louis Oosthuizen for helping him improve to 17-under through 36 holes.
“Louis gave me some lines off the tee which was very helpful, especially with the wind off the left,” he said. “The first six holes are not the easiest driving holes out there. Having Zach (Rasego), who caddied for Louis when he won the Open, also helped.”
Joel Sjoholm, in his first competitive round on the Old Course, matched Grace’s 67 to move into second at 12-under, tied with Thorbjorn Olesen (69).
Former Augusta State golfer Oliver Wilson (71) is 6-under.
Grace created a sensation at the start of the year on the European Tour, winning three events before May. He struggled after that, but arrived in Scotland having won the Vodacom Origins of Golf Final at Fancount last week on the South African Sunshine Tour.
Martin Kaymer was the best finisher of the four competing Ryder Cup players with 71 at Kingsbarns to move to 3-under. Peter Hanson (70) is a stroke back, Dustin Johnson shot 71 for 1- under and Paul Lawrie (70) is 1-over.
EUROPEAN LADIES TOUR: In Saint-Jean-De-Luz, France, Diana Luna shot 6-under-par 64 in the second-round to take a two-stroke lead at the halfway stage of the Lacoste Ladies Open de France.
The 29-year-old Italian is at 9-under 131 for two rounds. First round leader Stacey Keating followed her opening 62 with a one-over 71 and is in second place.
Carlota Ciganda (67), Anja Monke (63) and Anne-Lise Caudal (65) are four off the lead.
CHAMPIONS TOUR: In Cary, N.C., Russ Cochran topped the SAS Championship leaderboard in his return from a back injury, hitting all 18 greens in regulation and shooting 6-under-par 66.
Cochran is making his first start since the U.S. Senior Open in July.
Steve Pate, Andrew Magee, Fred Funk and Jay Don Blake are a stroke back. Magee extended his streak without a three-putt to 190 holes, the third longest on the tour this year.
Former Augusta resident Allen Doyle opened with 68, while Augusta native Larry Mize had 70.
WEB.COM TOUR: In Potomac, Md., David Lingmerth shot his second consecutive 6-under-par 66 to take the 36-hole lead in the Neediest Kids Championship.
Josh Persons (68) and Brad Fritsch (66) are one-shot back.
Augusta’s Scott Parel shot 71-70–141 to make the cut, which fell at 142.
Aiken native Matt Hendrix shot 80-72–152.