Day is the best of the three Australians to make the cut at Quail Hollow but a final hole meltdown has all but cruelled his chances at a second major title.
An eight at Quail Hollow's difficult par-four 18th was the final act in a round that had everything.
After starting well enough on day three with a birdie at the second thanks to a brilliant approach, things soured for the 2015 champion from there.
A bogey at the next and another at the ninth saw him head to the back nine three behind and he compounded his mistakes with a double bogey at the 12th.
Poor driving was to blame for most of his problems though it was an iron shot that betrayed him on the par-3 13th where he dropped another shot to fall six behind and seemingly out of the championship.
But Day has become known for his resilience in recent years and it was on full display when his pulled long iron to the short par-4 14th somehow stayed above the water line left of the green and he got up and down for birdie.
Another followed at the par-5 15th and he holed a long bomb at the difficult 16th to get back to just 1-over for the day and within three of the lead.
Much of that hard work was undone, however, on the closing two holes. Day made bogey at the difficult 17th then made a mess of the final hole on his way to a quadriple bogey 77.
The bizarre finish means Day starts Sunday seven shots behjind leaderrt Kisner though he is one of the few in the field with the firepower to produce a final round in the low 60’s.
While Day will have much to reflect on overnight Marc Leishman continued his recovery from an opening round of 75 when adding a second consecutive round of 71 to be at 4-over.
The highlight of Leishman’s round came at the 10th hole when he holed a monster from just behind the green for an eagle.
Adam Scott, who after a second round of 76 yesterday just scraped into the weekend on the number, continued what has been a disappointing week with a third round of 74 to be at 8-over par.
Scott began round three with a four putt for double bogey at the first and was on the back foot from there although he did bounce back over the final nine holes with three birdies before ruining all the hard work with a double bogey at the last.
Earlier in the day Scott Hend, who had four holes remaining when he returned to the course this morning to complete round two, was unable to force his way into the final 36 holes after playing the final four holes in even par and missing by one.
Rod Pampling, Cameron Smith and Stuart Deane were the other Australians to have teed it up on Thursday but finished well outside the cut line.