TAIPEI, Sept 29, 2012 (AFP) - Tsai got himself ready to repeat his 2002 victory at the event, as he posted a three-day total of eight-under-par 208 in relatively calm conditions at the Taiwan Golf and Country Club.
Baek Seuk-hyun of Korea got a 71 courtesy of a chip-in birdie on hole 17 to lie in second place, putting himself in the running to win his first Asian Tour title at the $600,000 event.
Filipino veteran Antonio Lascuna was a further shot back in third, followed by Malaysia's Danny Chia, who made a third consecutive 72.
Tsai, who grew up at the club, winning the 1997 Taiwan Open and 1998 Taiwan Masters, wielded a hot putter as he birdied the last three holes in a round of eight birdies and one bogey.
"I know this course very well. I played here so many times when I was a boy. I felt pretty relaxed out there but I'm shocked with my lead. It is amazing," said Tsai, who made 25 putts.
"My game came together. I was hitting it well off the tees and my irons were hot. If I can continue playing like this tomorrow, then I'm quite confident I can win," he added.
Baek, who already has three top ten finishes on the Asian Tour this season, was one-over for the tournament after 10 holes but recovered with a pair of birdies on 16 and 17.
The big 21-year-old however did not appear too worried about Tsai's huge lead.
"I'm happy with my score. I think anything can happen on this golf course. Every hole is not easy. If you miss one shot, you can drop two or three shots. I'm not going to think about winning yet. If I think about it, I might get nervous," he said.
Scores after the third round of the Mercuries Taiwan Masters 2012 (par 72)
208 - Tsai Chi-huang (TPE) 74-69-65
214 - Baek Seuk-hyun (KOR) 70-73-71
215 - Antonio Lascuna (PHI) 70-73-72
216 - Danny Chia (MAS) 72-72-72
217 - Gaganjeet Bhullar (IND) 75-74-68, Siddikur (BAN) 72-72-73
218 - Chan Yih-shin (TPE) 74-74-70, Guido Van Der Valk (NED) 73-72-73, Kalle Samooja (FIN) 71-73-74