The left-hander recovered from an error-strewn front nine, which he played in two-over after missing a succession of fairways, to card a level-par 70 after three birdies and one further bogey on the inward stretch.
That has the four-time major winner one-under for the tournament and out in front ahead of Hunter Mahan, Steve Stricker and former Masters champion Charl Schwartzel.
English duo Luke Donald and Justin Rose are also bang in contention, sitting on one-over-par alongside the 54-hole co-leader Billy Horschel, whilst Jason Day on two-over and Rickie Fowler one plus-three should not be discounted either.
As it stands, however, the championship is Mickelson's to lose. He turns 43 on Sunday and will hope to celebrate in style by finally landing his national championship at the 23rd time of asking, having been runner-up five times previously.
Speaking to the Golf Channel's Steve Sands after his third round, Mickelson - who will play alongside Mahan in the final group of Sunday - said: "I can't wait to get back out there. My ball-striking feels really good, I feel good on the greens but I think it's going to take an under-par round to win it."
Summarising his round, the three-time Masters champion added: "The fact I was two-over early on, I had be really patient, not force the issue and fight for a lot of pars out there.
"It's a very penalising golf course but there are birdie opportunities out there."
"I managed to take advantage of a few birdie opportunities and thought I played better than my score dictated but this is a really fun challenge. It's a hard challenge but a lot of fun. Every shot requires such great focus because the penalties can come up and bite you so quickly here. It's a very penalising golf course but there are birdie opportunities out there."
Mickelson is absolutely right when he says that Merion's East Course is providing a 'hard challenge'. On a tough day for scoring, only six players managed to break par. One of those was Paul Lawrie. The former Open champion carded a battling 69, which included a superb eagle-two at the short par-4 tenth. That has the Ryder Cup hero tied for 16th on six-over.
Sadly, Lawrie's fellow Scotsmen, Russell Knox and Martin Laird, couldn't quite match their compatriot's exploits. They signed for a 77 and a 76 respectively to be 11-over and 13-over heading into Sunday.
Tiger Woods, meanwhile, all but played himself out of contention for the championship after a dismal 76 - and, in doing so, has likely extended his winless streak in the majors into a sixth year.
The world No.1, who last won one of golf's big four at the 2008 US Open, started the day four shots out of the lead and still very much in the hunt. His cause was further helped when he birdied the first.
However, that was as good as it got for the 37-year-old, who thereafter carded a total of seven bogeys to match his worst ever score in the US Open as a professional. It also means that he has now, quite extraordinarily for a player of his talents, failed to break 70 in his last 11 weekend rounds in a major.
Woods' playing partner Rory McIlroy fared marginally better. The 2011 US Open champion had two birdies and seven bogeys in a five-over 75 to be one shot ahead of Woods on eight-over.
But spare a thought for Robert Karlsson. The giant Swede had eight bogeys, three doubles and a triple en route to a ghastly 16-over 86, which has him propping up the leaderboard on 22-over.
ONE MORE THING...
Sergio Garcia, who has been almost mercilessly heckled by sections of the galleries following his ill-advised remarks about Tiger Woods last month, is 11-over-par after three rounds. Not bad going considering he has played the 14th and 15th holes in a combined 13-over...