The Sunshine Tour graduates dug deep during the second round and by the close of play Grace, Oosthuizen, Ernie Els, Charl Schwartzel, George Coetzee and Thomas Aiken had all made the cut, which was set at five-over-par.
Young Americans Patrick Reed and Jordan Spieth led the tournament on five-under-par, while Grace and Dustin Johnson shared third place on four-under.
Els, a two-time winner of the tournament, carded steady rounds of 72, 70 to reach the halfway mark in a share of 28th place, while Schwartzel was a further shot adrift and tied for 35th on three-over.
Oosthuizen soon claimed his own share of 35th place when he carded a 66 that included five birdies and an eagle. The 2010 Open Champion has been struggling with a neck injury, but seems to be coming right at the perfect time.
Meanwhile, Aiken and Coetzee made it to the weekend on the cut line, which fell at five-over-par. The pair will surely be happy to compete over the weekend at Chambers Bay.