Atwal, who shot two-under on first day despite a lot of missed putts, opened with a birdie but then bogeyed three times between third and seventh.
The birdies on 12th and 15th salvaged his round and he ended with one-under 70 to get to three-under 139 and Tied- 57th place.
Meanwhile Chad Collins missed a chance for the 10th sub- 60 round in PGA TOUR history and third of the season, parring the final two holes for an 11-under 60 on Friday in the second round.
Collins hit his approach to the back fringe on the par-4 18th, leaving a 70-foot downhill birdie try that he hit 5 feet past.
Grayson Murray (64) and Cameron Tringale (66) were tied second at 11-under 131 and four shots behind leader Collins. Jim Furyk shot a record 58 last year in the Travelers Championship in Connecticut and is one of eight players to shoot 59. Justin Thomas and Adam Hadwin shot 59s in January.