Overton, whose 62 topped the old mark by a stroke at The Mines Resort & Golf Club, and Jacobson, who carded a seven-under 64 on Friday, finished 36 holes at 13-under 129.
Bo Van Pelt missed a 12-foot birdie try at the last, but settled for a seven- under 64 in round two. He is alone in third place at minus-12.
This is an unofficial event on the PGA Tour, but Overton, who is winless, is certainly happy with his play.
He's probably just happy to be here.
Overton found out over the weekend that he got into the field when David Duval decided not to make the trip. Overton's clubs arrived on Wednesday and he didn't even get a practice round under his belt before his tee time came up on Thursday.
"I went out in the pro-am and just kind of slapped it around with the amateurs' clubs," Overton said in a televised interview. "It was kind of a nightmare watching the ball go really spinny and really high. It's just been a fun week so far. Hopefully I get over this jet lag. The heat's really wearing on you."
It didn't look like anything was bothering Overton on Friday.
He flew out of the gate with three straight birdies, then birdied the fifth to reach eight-under par. At the par-four eighth, Overton rolled in a six-foot birdie putt, but was one off the lead.
First-round leader Robert Allenby was still in front, but stumbled to a double-bogey at the ninth when he hit his second out of bounds. That opened the door for Overton to move into first.
Overton drained a 10-footer for birdie at the 12th and he was alone in front at 10-under par. After a pair of pars, Overton went for the green from the tee at the par-four 15th and the decision paid off spectacularly.
Overton's drive stopped eight feet short of the flagstick. He converted the eagle putt to get to 12-under for the championship.
"I saw Mark Wilson hit it right at the pin," Overton explained on television. "I've been hitting my driver great all day. It was all over it. I took a really good visual image of it and the thing got a great little bounce."
Overton missed the green with his second at the par-five 17th, but chipped inside three feet. He tapped in the birdie putt, but missed a 10-foot birdie try at the last.
With the way Overton played on Friday it didn't look like anyone was capable of catching him, but Jacobson used a brilliant back nine to match him in the lead.
Jacobson was only two-under on his front side after a bogey at one and birdies at two, four and six. He parred his first two holes on the second nine, then caught fire.
He birdied three in a row from the 12th to creep up the leaderboard and when his short birdie putt fell at 15, not only was it his fourth straight, but the Swede was only one off Overton's lead.
Jacobson made a clutch six-foot par save at 16, then reached the par-five 17th in two. He two-putted for birdie to tie Overton at 13-under par, but found trouble at the last.
His drive missed the fairway and Jacobson's approach sailed over the target into a back bunker. Jacobson didn't have the easiest sand shot, but blasted out to two feet and kicked in the save to stay even with Overton.
"I've been driving it well," Jacobson said in his televised interview. "I feel like I've had a lot of short opportunities. I've let some of them go and then I've made some long ones. It's been a little bit of a trade off."
NOTES: Jacobson earned his first PGA Tour victory at this year's Travelers Championship...There is no cut at this event...Defending champion Ben Crane shot a three-under 68 and is tied for 18th at five-under par.