Ilonen's spotless round took him to a two-day total of 12-under at the $3.2 million event, co-sanctioned with OneAsia, with two recent winners - Australian Brett Rumford and Thailand's Kiradech Aphibarnrat - chasing him on nine-under.
The Finn, whose two European Tour victories came in 2007, has already finished ninth in Qatar and second in Morocco this season and looked set for another strong show at the Tianjin Binhai Lake Golf Club.
"I hit the ball better than yesterday," Ilonen, who carded a 69 in the opening round, said. "I gave myself a few more chances on the greens, especially on the back nine, and managed to take quite a few of them, so it was a very stress-free round today.
"I didn't put myself in any trouble at all, which is always nice, and it's nice to be three ahead going into the weekend."
Rumford, last week's Ballantine's Champion, found motivation in the 67th birthday of his caddie John Roberts to shoot a five-under-par 67 for a share of second place.
"Each player has their own motivation, I guess, and that varies from day-to-day," said Rumford, who ended a five-year drought with victory in Korea last week.
"It was in my mind at the beginning of the day that it would be nice to shoot 67 on Ronnie's 67th birthday. Tomorrow I'll have to find something different to motivate me."
Thailand's Kiradech, who won his maiden European Tour title at the Malaysian Open in March, also carded a 67, mixing six birdies with a lone bogey. (Reporting by Sudipto Ganguly in Mumbai; editing by Martyn Herman)