After a rollercoaster opening round of 68, which included 10 birdies, two bogeys, a double and a triple, the 18-year-old from Bangkok rediscovered her form with the driver and reeled off five birdies at holes four, six, seven, 14 and 16.
"Today I played pretty good and my driver was a lot better," said Jutanugarn, who is playing in her third tournament of the year after taking eight months out through injury.
Jutanugarn put together a series of top finishes on both the LPGA and LET last year before her injury in May and was shaping as a player to contend with Lydia Ko as the game's best emerging player. She might yet be.
"My game was a lot better than yesterday in general. Today my putting was not very good, but it was okay. Yesterday my putting was a lot better than today. It's very nice to play here because having won here it makes me a lot more confident."
Jutanugarn sits two clear of 15-year-old French amateur Mathilda Cappeliez, who had a tournament low seven-under 64 and Germany's Nina Holleder, who fired a second successive round of three-under-par 68.
Cappeliez, from Evian-les-Bains and who is a member at the Evian Resort Course, home to the Evian Championship, had five birdies and an eagle on a flawless score card.
"It was an amazing day," said Cappeliez, who is playing in her second professional tournament following an LET debut at the 2013 Lacoste Ladies Open de France, where she missed the cut.
"I putted really well with no bogeys on the card, so it was easier to make a good score. My game was nice, always on the green. My game was really good.
"After the first nine I was minus two and just a little bit nervous, but after the birdie, eagle and birdie on 10, 11, 12 I was trying to make pars. I think my game was like the pros so it made me feel secure."
Playing in warm and blustery conditions in the morning, 26-year-old Holleder, from St. Leon-Rot, fired four birdies and one bogey.
Her hope was to make the cut this week, but she is now in contention for her first win in two seasons on the LET.
"I played the last two rounds really solidly and hit 16 greens each day, so it was not too difficult as the putter was good. I had more chances for birdie but I'm happy with it," said Holleder, who is now healthy after playing for six months of her rookie season with a neck injury.
"At least I hope to improve from last year and climb up a bit in the ranking so that I have the full tour card for next year, because I'm still in category 9b now," said Holleder, who lives a five-minutes bicycle ride from Golf Club St. Leon-Rot, the venue of The 2015 Solheim Cup.
Laura Davies, Gwladys Nocera, Sophie Giquel-Bettan and overnight co-leader Sophie Walker were all on five-under-par and each rued a few missed putts, although their long games were excellent.
"I've played really well. I've hit 17 greens the first day, 17 greens today and the story is not making enough putts," Davies said. "33 putts both days, but having said that, I'm at five-under-par and in a decent position."
Nocera said: "It looks good when you look at the board, but the way I played, when I hit the ball, it was so close to the pin and I didn't make a putt, so it's frustrating. I know I'm on top of the leader board but I'm pretty disappointed with my day.
"I guess I am tough on myself and I always want to do better. I'm here to work and to win. For me, it's not a good day, but I look at it that I'm on top of the leader board but could do so much better."
It was a similar story for Walker, who said of her level par 71: "It's probably the worst it could get. I played really well and just didn't hole as many putts: that was the difference. I think I had 32 putts today and 28 yesterday. I think on this course you need to stay patient so I feel I'm in a great position."
Meanwhile Lee-Anne Pace, Rebecca Hudson and Nobuhle Dlamini are a stroke further behind on four-under-par.
Pace's round included an eagle on the par-five second hole, where she pitched in from 45 metres using a 60 degree wedge.
She said: "I started really well with two threes. I eagled two, pitched it in and then was really steady from there. I made another birdie, three-putted twice unfortunately today but I feel like my putting's been really good and my pace has been good on the greens so I'm looking forward to a really good weekend.
The leading Australian at the halfway stage is South Australian Stephanie Na who is in 14th position and six from the lead.
Leading scores at the end of round 2:
134 - Ariya Jutanugarn (THA) 68 66
136 - Nina Holleder (GER) 68 68, Mathilda Cappeliez (FRA) 72 64
137 - Sophie Walker (ENG) 66 71, Sophie Giquel-bettan (FRA) 67 70, Laura Davies (ENG) 68 69, Gwladys Nocera (FRA) 69 68
138 - Lee-Anne Pace (RSA) 70 68, Rebecca Hudson (ENG) 66 72, Nobuhle Dlamini (SWZ) 69 69
139 - Margherita Rigon (ITA) 69 70, Trish Johnson (ENG) 72 67, Charley Hull (ENG) 68 71
140 - Diana Luna (ITA) 70 70, Beth Allen (USA) 69 71, Holly Clyburn (ENG) 70 70, Stephanie Na (AUS) 72 68, Rebecca Codd (IRL) 69 71
141 - Liz Young (ENG) 72 69, Fiona Puyo (FRA) 72 69, Vikki Laing (SCO) 70 71, Jing Yan (CHN) 68 73, Karolin Lampert (GER) 69 72, Heather Macrae (SCO) 73 68, Linda Wessberg (SWE) 71 70
142 - Florentyna Parker (ENG) 73 69, Mireia Prat (ESP) 74 68, Maria Salinas (PER) 71 71, Stacy Lee Bregman (RSA) 71 71, Marta Silva Zamora (ESP) 73 69, Adriana Brent (AUS) 69 73, Cathryn Bristow (NZL) 71 71, Celine Herbin (FRA) 71 71, Titiya Plucksataporn (THA) 72 70