Steele shot a four-under 66 on Saturday, while Dufner, a second-round co- leader, had a two-under 68. The two finished at seven-under 203 and are one stroke ahead.
Keegan Bradley, the other second-round leader, posted a one-under 69 and is third at minus-six.
Scott Verplank, 47, carded a 69 on Saturday, which got him to fourth at five- under 205.
Steve Stricker, the first-round leader who matched the major championship scoring record with a 63, fashioned a one-under 69 in round three and is alone in fifth at minus-four.
MORE TO FOLLOW.