Shin, who broke the tournament record with a nine-under 62 in the first round on Friday, had four birdies and her first bogey on the River Course to end the second round at 12 under.
That was good enough for a one-stroke lead over American Danielle Kang who shot a 64, with Dewi Claire Schreefel and Paula Creamer at 10 under after a 66 and 67 respectively.
"I have to know my position, and I keep changing my plan each hole after I check the positions," Shin said. "I saw a lot of players play good today, so I think it will make for fun competition the next two days.
"I really like when I'm on the top, but it also can come with a pressure, a little bit of pressure. But it's also other players saying they get the pressure, too, so I just keep focused on my game."
At nine-under were Lexi Thompson (66) and Azahara Munoz (68), while Stacey Lewis (65) and Maria Hjorth (69) were at eight under.