Cameron Smith remains on course to retain his Australian PGA Championship title after earning a three-shot lead going into Sunday's final round.

Smith beat fellow Australian Jordan Zunic in a playoff to win at RACV Royal Pines Resort last year.

And the 25-year-old, who has one PGA Tour victory in the United States to his name, posted a five-under 67 on Saturday to reach 14-under overall for the European Tour event, which is co-sanctioned by the PGA Tour of Australasia .

Smith avoided dropping a single stroke during a confident display in Queensland, where two birdies on the way out and three on the back nine put him in position to claim the third professional victory of his career.

He will be joined in the final group by another Australian regular on the PGA Tour, Marc Leishman, whose three-under 69 saw him move outright second at 11 under.

American Harold Varner III, one of the few international representatives on the leaderboard, and Matthew Millar are tied for third at seven under.

Jake McLeod had led jointly after the opening round and remained in touch with Smith at the halfway mark, but a three-over 75 saw him drop back into a share of eighth at five under.