Atwal, who was tied third after the first round, shot a second round four-over 74 and tumbled to tied 52nd, a fall of 49 places.
Starting at the first with a bogey, he had three more on the front-nine -- on fifth, sixth and ninth -- to turn in four-over.
Further bogeys on 12th and 14th put him outside the cut-line but back-to-back birdies on 15th and 16th kept him alive for the weekend. He was one-over 141 and the cut came at 142.
Meanwhile, Rory McIlroy snapped his string of three straight missed cuts, shooting a five-under 65 to take the lead into the weekend.
McIlroy, who defends his US Open title next week at the Olympic Club, birdied three of his final four holes and had an eagle, five birdies and two bogeys to match his lowest PGA Tour round this year.
Jeff Maggert, tied for the first-round lead with John Merrick, shot a 68 to match JB Holmes (64) and Kevin Stadler (65) at six-under. Merrick had a 69 to join Chad Campbell (67) and Kevin Kisner (66) at five-under.
Davis Love III, the Americans' Ryder Cup captain, had a 68 and was tied with Padraig Harrington (68) at four-under. John Daly birdied his first three holes on his back-nine to get to five-under but finished with a 69 and was at tied at three-under -- making his fourth cut in five events.