Merritt moved to the top of the leaderboard even before the second-round leaders hit their first shots. He had 11 birdies and a bogey on the par-5 eighth hole.
Chappell had a 67 to join him at 14-under 199.
The challengers at the tournament midpoint included Tiger Woods, but the two-time champion and tournament host was errant off the tee early, gave back three strokes in his first 12 holes and finished with a 74 to drop into a tie for 42nd at 5 under.
Rickie Fowler was one shot back after a 68, and Jason Bohn (67), Whee Kim (67), Charles Howell III (67) and David Lingmerth (68) were 12 under with a round left at Robert Trent Jones Golf Club.
