Webb hit a 6-iron from a fairway bunker over a tree and on the green, then holed the 15-foot putt to finish three rounds at 15-under 201 at rain-softened Royal Pines.
"I hit a great shot into the green there," Webb said. "It was a great way to finish. If you told me I would shoot 64 today, I would have thought I'd have at least a two-stroke lead, but it will make it exciting for tomorrow."
Because of the soft conditions on the resort course, players were allowed to lift, clean and place their golf balls in the fairway.
South Korea's Lee Bo-mee (63) and defending champion Katherine Hull (65) were a stroke back, and South Koreans Seo Hee-kyung (66) and Ryu So-yeon (66) were 13 under.
"A lot of people out there will be waiting for this showdown," said Hull, set play in the final group Sunday with Webb. "It's going to be a good battle tomorrow and a nice showcase for Australian golf."
Organizers say they consider Lee's 63 a course record because they changed two tee boxes this year. Australia's Kristie Smith has a 62 in the tournament last year, the lowest score on the course before it was lengthened slightly.
American Amanda Blumenherst, the leader after the first two rounds, had a shot 70 to drop into a tie for sixth with Taiwan's Yani Tseng (67) at 11 under.
Webb hopes her experience will help her Sunday.
"I've made some good shots here before and great putts, and when you have those kinds of feelings, it makes you comfortable," she said.
Lee, who has not had a bogey in three rounds, is playing at Royal Pines for the first time and only had two nine-hole practice rounds over two days due to heavy rain.
"My goal was to shoot 10 under for the tournament and with no bogeys," Lee said. "The way I played today, it's now possible I could win."