The 30-year-old South Korean shot a 3-under 68 in the third round on Saturday to hold off a charge from Scheffler and 2023 US Open champion Wyndham Clark, who had matching 65s.
Sungjae Im, Kim's countryman, followed a second-round 61 with a 67 and was another two shots back with Stephan Jaeger and Tom Hoge. Jaeger's 64 was the low round of the day at the TPC Craig Ranch.
Kim, the field's second highest-ranked player behind Scheffler at No. 24, was in position for a 59 in the second round but had a bogey at 18 that forced him to settle for 60.
His five-shot lead was tied for the second-biggest on tour through 36 holes this season behind Rory McIlroy's six-shot edge when he defended his Masters championship in April.
But it was gone by the 11th hole in the third round.
Three bogeys in a span of four holes dropped the four-time tour winner into a tie with Clark at 18 under. Clark had earlier pulled within a stroke with a short eagle putt on the par-5 ninth.
Clark took the lead with a scrambling birdie at the par-5 12th, making a putt after a bunker shot with his right foot in the grass, his flexed right knee almost touching the ground.
Kim, Scheffler and Clark were tied at 19 under when Kim went in front with a birdie on the short par-4 14th after Scheffler and Clark settled for pars after trying to drive the green.
Clark got even again, but Kim went in front for good with a birdie at the par-3 15th.
Scheffler, a four-time major winner who ran away to an eight-shot victory at last year's Nelson, answered his first bogey of the tournament on the par-3 fourth with three birdies over the final five holes on the front nine.Â
Jordan Spieth, a hometown favourite alongside Scheffler, faded with four bogeys on his first five holes on the back nine a day after six consecutive birdies to start his second nine spurred a 62. He shot 73.
First-round leader Taylor Moore was back in contention after four consecutive birdies, but went in the water at 15 and ended up with a triple-bogey 6. He shot 69 and was 13 under.
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