DUBAI, Feb 2, 2013 (AFP) - Gallacher, nephew of the former European Ryder Cup captain Bernard, rattled the pin with his second shot on the par-5 13th and then holed his bunker shot on the 18th from 30 yards.
That, along with six other birdies, helped him reach 21-under par 195 after three rounds.
The 195 total of the 38-year-old Scotsman was one better than the tournament record of 20-under par set by Tiger Woods during his first visit to the UAE in 2001.
The lowest winning total in the tournament is 22-under par by Thomas Bjorn that same year.
South Africa's Richard Sterne, leader after the first two days at 12-under par, added a solid third round of six-under par 66, but could only watch in astonishment as Gallacher sped past him.
Two shots behind Sterne's 198 was rising Danish star Thorbjorn Olesen (67), while Chile's Felipe Aguilar (66) and India's Jeev Milkha Singh (67) were tied for the fourth place at 14-under par 202.
World No8 Lee Westwood made a charge with a 66 that moved him to ninth place at 204, nine shots behind the leader, while No14 Sergio Garcia could only add a 71 to tie for 19th place at 206.
Defending champion Rafael Cabrera-Bello shot a third successive round of 69.
Gallacher, who shot a 63 on the opening day and has finished second and 10th the previous two years in the tournament, said: "I just think I've played this golf course a lot of times.
"I've come out on holiday here and I am quite familiar with the course. I came here over Christmas and a couple days earlier before the start of the season.
"You know your way around here, the lines, you know where to hit it and where not to hit it. It's obviously in great condition and kind of suits my eye as well.
"I'm excited and looking forward to tomorrow. I struggled last week in Doha and found out that my driver had a hairline crack. With the new one, I'm hitting more fairways and I've putted really good. On these courses, you have got to be hitting from the fairways."
While Gallacher, ranked 111th in the world, is looking for his first win since the 2004 Alfred Dunhill Links Championship, his good friend Sterne is hoping end a title drought that started in early 2009.
"I'm quite happy. The weather was a bit dodgy in the beginning, but the weather kind of came around and it wasn't too bad," said 165th-ranked Sterne.
"The conditions are pretty good. As you can see, a couple of good scores. You know, shooting 66 and I'm three behind, which unfortunately can happen in this game."
"I've given myself a chance going into tomorrow, in the last group again which will be hopefully a lot of fun and put some good scores on there and put some pressure on Stephen."
Complete third-round scores in the $2.5million Omega Dubai Desert Classic on Saturday at the par-72 Majlis course of Emirates Golf Club:
195 - Stephen Gallacher (SCO) 63-70-62
198 - Richard Sterne (RSA) 62-70-66
200 - Thorbjorn Olesen (DEN) 67-66-67
202 - Felipe Aguilar (CHI) 68-68-66, Jeev Milkha Singh (IND) 68-67-67, Tommy Fleetwood (ENG) 65-68-69
203 - Steve Webster (ENG) 69-69-65, Maximilian Kieffer (GER) 66-68-69,
204 - Lee Westwood (ENG) 67-71-66,
205 - Robert Rock (ENG) 70-68-67, Justin Walters (RSA) 68-70-67, Noh Seung-Yul (KOR) 66-72-67, Gareth Maybin (NIR) 69-67-69, Marcus Fraser (AUS) 67-69-69, Andy Sullivan (ENG) 69-67-69, Jbe Kruger (RSA) 70-66-69, Andreas Harto (DEN) 67-67-71, Chris Doak (SCO) 65-69-71
206 - Alexander Noren (SWE) 68-71-67, Fredrik Andersson-Hed (SWE) 67-71-68, Raphael Jacquelin (FRA) 70-68-68, Ricardo Santos (POR) 66-71-69, Sergio Garcia (ESP) 68-67-71, Romain Wattel (FRA) 68-67-71,
207 - Garth Mulroy (RSA) 71-70-66, Rafael Cabrera-Bello (ESP) 69-69-69, Ignacio Garrido (ESP) 69-68-70, Matteo Manassero (ITA) 66-71-70, Scott Jamieson (SCO) 65-72-70, Peter Lawrie (IRE) 66-70-71,
208 - Anthony Wall (ENG) 68-72-68, Marcel Siem (GER) 68-72-68, Jamie Donaldson (WAL) 67-73-68, Lorenzo Gagli (ITA) 68-71-69, David Drysdale (SCO) 69-70-69, Todd Hamilton (USA) 70-68-70, Jose Maria Olazabal (ESP) 70-67-71,
209 - Jorge Campillo (ESP) 69-71-69, Robert-Jan Derksen (NED) 68-72-69, Lee Slattery (ENG) 69-70-70, Gary Lockerbie (ENG) 68-70-71, Gregory Bourdy (FRA) 67-71-71, Henrik Stenson (SWE) 69-69-71, Gregory Havret (FRA) 70-67-72, Thongchai Jaidee (THA) 68-68-73, Paul Casey (ENG) 66-70-73,
210 - Ricardo Gozalez (ARG) 71-70-69, Mikko Ilonen (FIN) 71-70-69, Craig Lee (SCO) 69-70-71, David Howell (ENG) 70-68-72, Marc Warren (SCO) 67-72-71, Eddie Pepperell (ENG) 68-70-72, Chris Wood (ENG) 68-68-74,
211 - David Horsey (ENG) 75-66-70, Robert Coles (ENG) 73-68-70, Simon Khan (ENG) 68-73-70, Marten Lafeber (NED) 69-71-71, Matthew Nixon (ENG) 69-69-73
212 - Pablo Larrazabal (ESP) 71-70-71, Alessandro Tadini (ITA) 70-71-71, Mark O'Meara (USA) 67-74-71, Bernd Wiesberger (AUT) 71-68-73,
213 - Jaco van Zyl (RSA) 69-71-73, Damien McGrane (IRE) 68-72-73, Jean-Baptise Gonnet (FRA) 72-68-73, SSP Chowrasia (IND) 69-70-74, Keith Horne (RSA) 68-71-74
214 - Simon Dyson (ENG) 70-71-73, Oliver Fisher (ENG) 69-72-73,
215 - Tom Lewis (ENG) 69-72-74, Thomas Levet (FRA) 68-70-77