The 33-year-old Texan led his squad to victory for the third straight year in the time trial, clocking 1 hour, 10 minutes, 39 seconds for the 41.85-mile trek from Tours to Blois. Team CSC was second.
"It's always nice to be in yellow," Armstrong said. "There are three or four flat stages coming, so it will not be easy to defend the jersey."
Team CSC was runner-up, finishing a mere 2 seconds behind. American rider David Zabriskie (search) of CSC, who had come into the stage in the leader's yellow jersey, fell less than a mile before the finish.
Zabriskie got back onto his bicycle, his uniform torn and left thigh scraped, and coasted across the finish line. He now trails Armstrong by 1:26 and fell to ninth overall.
"The (team time trial) is so hard at the end that everybody's on the limit, everybody's a little bit cross-eyed," Armstrong said. "You come into the city, there's a lot of turns and you get the whipping wind and it's easy to make a mistake like that. So I can clearly see how it happened, but it's clearly a bad one for him."
Armstrong will wear the yellow jersey for the 66th time in his Tour career. His teammate, George Hincapie, is second overall, 55 seconds behind.
Under overcast skies, the nine-man teams set off one-by-one through the Loire River valley, known for its majestic medieval and Renaissance castles, and through the town of Ambroise where Leonardo da Vinci spent the last years of his life.
The Discovery teammates took turns leading the single-file pack of riders.
"It was a very tight matchup as we expected. We kept a good rhythm," Discovery team director Johan Bruyneel said. "We stayed together. It was a beautiful machine operating."
The Discovery team set a record for a Tour team time trial with an average speed of 35.54 mph — easily beating the previous record of 34.06 mph.
Armstrong and Discovery now must decide whether they want to maintain the race lead and the ensuing pressures, or give up the yellow jersey until later in the race that finishes July 24 in Paris.
The riders next embark on three relatively flat stages toward Germany, starting with a 113-mile ride from the Chambord castle to the industrial town of Montargis on Wednesday.
"There's still a lot of racing to go, a lot of nervous days, anything can happen, crashes here, crashes there, especially the stages in the few days which are tricky," Armstrong said.