Playing alongside Lee, Saigo produced the low second round, a sizzling six-under-par 66, to vault to a three-stroke lead after storms twice forced the suspension of play at Erin Hills, outside Milwaukee.
The 23-year-old 2024 rookie of the year and winner of last month's Chevron Championship is eight under through 36 holes, with world No.1 Nelly Korda among her closest challengers.
After a frustrating first day on the greens, Korda fired up with seven birdies in a second-round 67 to surge into a six-way tie for second at five under with fellow Americans Sarah Schmelzel (68) and Yealimi Noh (71), Japan's Hinako Shibuno (69), Swede Maja Stark (69) and South Korean A Lim Kim (71).
Lee and fellow WA major champion Green are the leading Australians - and only two to make the halfway cut - and will start the weekend six back of Saigo at two under.
Lee, the 2022 US Open champion and final-round leader last year, was chuffed to climb 40 spots up the leaderboard into a share of 19th and back in red numbers with a three-under 69.
"I just hit it a little bit closer than yesterday. I probably had a lot of outside chances for birdie yesterday, like 25 to 30 feet, but today I had a few more that were like inside 15 feet," Lee said.
"Just started really well, made two birdies on the get-go, so it was nice turning three under and had even on the back, just seeing a few more putts roll in and then just hitting it a little bit better."
After watching Saigo drain seven birdies, Lee knows there will be weekend opportunities to make up the six-shot deficit and capture a third career major.
"Just with maybe a little bit of rain softening the greens a couple of days ago, but I think USGA has a lot of tricks up their sleeve so they can always make it as tough as they can make it or they can make it really challenging and fun to play," Lee said.
"The greens are probably going to get a little bit quicker and it will be a bit more interesting with, I guess, putting the tees in different places.
"I'm looking forward to the weekend. Hopefully I can hit it a little bit closer, just play aggressively when I can and play smart when I have to. That's going to be the key."
Green also hopes to run down the leader after riding her luck in a round of 70.
"This is probably the best placing that I've gone into an actual weekend of the US Open, so I'm hoping I'm not too far back," said the world No.8.
"Six shots back, I'm not sure what the conditions are going to be like this weekend. I think the harder the better.
"So I'm hoping I can just continue with the game plan that my caddy and I have and have a good weekend."
