Laura Diaz shot a two-under 70 to take a one stroke lead over Brittany Lincicome halfway through the Scandinavian TPC on Friday.
Annika Sorenstam, the three-time defending champion who is the official host of the Ladies' European Tour event, slipped to a 75 and was seven shots back. The Swede shared 14th place with nine others.
"This was not fun at all," Sorenstam said. "I felt fine on the range, but on the course it didn't work. I'm really disappointed."
Diaz had a 36-hole total of five-under 139 on the Barseback course in southern Sweden, where Sorenstam helped Europe win the 2003 Solheim Cup over the US.
Diaz had two bogeys on the front nine, but the American finished her round with a birdie on the 18th -- her fourth birdie of the day.
"I seemed to hit more greens today than yesterday, but I wasn't able to make some putts," said Diaz, who is in contention for the Solheim Cup that will be played next month on another Swedish course.
"The greens are perfect and it's really nice weather to play in," Diaz said. "Overall I am pleased with the day, although I always leave [the course] wishing I could have hit a few more putts."
Lincicome had six birdies -- matching Suzann Pettersen for most birdies of the day -- but the American also had three bogeys for a 69.
Pettersen, a Norwegian who won her first major this year at the LPGA Championship, had a 68 for the best score of the day and shared sixth with Sweden's Louise Stahle at 143.
Paula Marti of Spain, amateur Caroline Hedwall of Sweden and Jade Schaeffer of France were tied for third at 142.
Overnight leader Minea Blomqvist of Finland dropped to joint eighth at 144 after a 76.
Catrin Nilsmark, the 2003 Solheim Cup captain for Europe, and fellow Swede Mikaela Parmlid got two-shot penalties for slow play on the ninth and 10th holes respectively, but both made the cut.