Newgarden went off-strategy to get onto the softer red-marked Firestone tires earlier in the session due to the gradually increased pace the compound would yield as the session wore on.
The two-time series champion will be looking to secure his and Penske’s first win of the 2021 NTT IndyCar Series campaign with his third pole in as many races.
Andretti Autosport’s Colton Herta looked to have the measure of Newgarden but was beaten the narrowest of margins as the session came to a close.
Chip Ganassi’s Marcus Ericsson secured his best qualifying result in IndyCar with third in the No.8 Huski Chocolate Honda, just ahead of Will Power in fourth.
Six-time series champion Scott Dixon could only muster a time good enough for fifth, but will crucially start ahead of his championship rivals on what is his most successful circuit in IndyCar.
Alexander Rossi finally improved his fortunes to start from sixth. The Californian was fortunate to progress deeper into qualifying after penalties were handed out to his rivals in the opening session for the incident involving Jack Harvey.
It was a tight affair at Chip Ganassi Racing at the end of Q2 where Ericsson knocked out team-mate and championship leader Alex Palou by just 0.039s.
The Spaniard will start from seventh on the fourth row with Graham Rahal for company.
James Hinchcliffe secured his best qualifying result of the season in ninth and, heads up row five alongside Andretti Autosport team-mate Ryan Hunter-Reay.
On his return from injury, Ed Carpenter Racing’s Rinus VeeKay was still able to wrestle his No.21 Sonax-Chevrolet to 11th on the grid ahead of A.J Foyt’s Sebastien Bourdais.
Championship challenger Pato O’Ward will have his work cut out for Sunday’s race after failing to get through the first part of qualifying with a very recalcitrant No.5 AMSP Chevrolet and will start 20th on the grid.
Harvey was set to progress into Fast 12, however a spin at the very end of the first session caused a yellow flag and his best time was deleted as a penalty. The Briton will start from all the way down in 24th.
The 80-lap Honda Indy 200 will start at 12:00 EDT Sunday on NBC.