His technical score of 57.91 was more than eight points better than anyone else, and accounted entirely for his lead over Adam Rippon, who received a marginally better grade for artistry.
Chen received 104.45 points overall ahead of Rippon's 96.52, with Jason Brown third on 93.23.
Chen's short performance, ahead of Saturday's free skate, came despite battling a cold in recent weeks and, by his own admission, struggling a little in practice.
"The circumstances going into this competition weren't great but I've struggled before with illness, with injury and I know I can push through anything and that's what I reminded myself of here," he said.
The only man to land five quad jumps in competition -- a quad refers to four spinning revolutions in the air -- Chen won the Grand Prix final in Japan on Dec. 8 and his class was on full display again on Thursday.
He made a confidence-boosting start by landing a quad flip-triple toe combination, and followed it up with an equally impressive quad toe.
Only on his final jump, a triple Axel, did he falter, stumbling upon landing but managing to regain his balance without touching his hand on the ice.
The U.S. championships offer a final chance for the men to impress selectors before three are named for the Pyeongchang Games.
In the pairs short program on Friday, the husband-and-wife duo of Chris and Alexa Knierim took the lead as they look to lock down the only U.S. berth on offer for South Korea.
"So far it wouldn't have gone any better," said Alexa.
The championships continue with the women's free skate on Friday night.
(Reporting by Andrew Both in Cary, North Carolina; editing by Amlan Chakraborty)
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