Two-time victor Sergio Garcia leads the way by four shots after posting a superb eight-under 64 at the Gary Player Country Club, registering eight birdies in his bogey-free round. Oosthuizen, who is from South Africa, has never won his country's most prestigious tournament.
McIlroy has yet to win on the European Tour this season but is still in contention for the Race to Dubai and to be crowned Europe's top golfer for 2018.
Sergio Garcia held on to his lead at the Nedbank Golf Challenge hosted by Gary Player, as Louis Oosthuizen impressed on home soil.
Li Haotong, who can also win the Race to Dubai, carded a 1-under 71.
Garcia couldn't match his blistering opening-round 64 and ended with a bogey when his short par putt looped all the way around the hole and came back out. "It's not ideal to see three-putts, but some of the pins were nearly impossible to get to and when you leave yourself 20 or 25 feet putting over hills then it's gonna happen sometimes", a phlegmatic Garcia said after his round on Friday.
"Shooting 68 or 69 today would have been great, but unfortunately that didn't work out, but you have to be extremely precise on this course".More news: OKEx Adds XRP and Litecoin Margin Trading
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But he was once again unable to safely negotiate the par-four eighth, following his first-round bogey with a double bogey Friday.
Finland's Mikko Korhonen is two shots back from Oosthuizen while South Africa's Dylan Frittelli is in a group of players on four-under.
"It's a tournament I've always wanted to play as a kid and came here plenty of times with the family to watch", he said.
While the two-time Sun City champion put his good fortune down to the vagaries of the wind not punishing him and some "bonus putts", his round on a first visit to Sun City since 2013 was remarkable. "Hopefully I can get off to a good start this week".
He is four shots ahead of the field.
Defending champion Branden Grace is also on three under, while Rory McIlroy is eight strokes off the pace after a one-under 71. The West Waterford man (31) added a three-over 74 to his opening 72, racking up a quadruple-bogey eight at his ninth hole, the 18th, to finish well down the leaderboard on four-over at El Camaleon Golf Club.