The Englishman finished his second round with a 13-under-par 129 on the board at Phoenix Country Club.
Donald got off to a fast start with birdies on 10 and 11, before producing birdie efforts at 13 and 15 to move serenely to 10-under.
The world number three carded three more birdies on the front nine to move four clear of the field as he continued to look in imperious form.
Shunsuke Sonoda posted a 66 to move into second place at nine under, while Hiroyuki Fujita also had a 66 to finish two rounds in third place at seven under.
Last year's winner, Toshinori Muto, carded a two-under 69 to move into a share of 11th at three under.
Shigeki Maruyama, American Ricky Barnes and Italian Edoardo Molinari were among those that missed the cut.
Leaderboard
1 Luke DONALD -13
2 Shunsuke SONODA -9
3 Hiroyuki FUJITA -7
4 Koichiro KAWANO -6
5 Hirohito KOIZUMI -5