The three-time PGA Tour winner has successfully fought the rare skin condition Stevens-Johnson syndrome to continue his career. He has four runner-up finishes in 81 career starts on the 50-and-over tour.
Toledo made five straight birdies on his first nine, added three more on Nos. 1, 2 and 4 and capped his bogey-free round with another on the ninth. The 53-year-old Mexican player won the Allianz Championship in February for his fourth senior title.
Fran Quin was a stroke back, making six birdies in an eight-hole stretch that ended on the par-5 16th. The 51-year-old Quin has finished in the top 25 in all three of his tour starts this year.
Kevin Sutherland and Tom Byrum shot 65, and Fred Funk, Duffy Waldorf, Loren Roberts and Bart Bryan followed at 66.
Large crowds followed the players in event that hometown PGA Tour player Steve Stricker helped launch and hosts. He turns 50 in February and will be eligible to play next year.
"We can't ask for anything more," Sutherland said. "There was a lot of people out there today. It was amazing to see everybody out here. I think it says a locality about Steve Stricker, about the way people feel about him around here, and they should. He's a tremendous human being, he's obviously a great golfer. So this says a lot about Steve, says a lot about Madison. It's been fantastic."
Bernhard Langer topped the group at 67. The 58-year-old German star is coming off a victory two weeks ago in the Constellation Senior Players Championship, his second major win of the year. He has three overall victories this year to push his senior total to 28.
"I just didn't make any putts on the back nine," Langer said. "Played pretty good, but the greens were a bit on the slow side, so I left a couple short and didn't get it close enough. But overall it's a solid round. I'm right there. Got two days to catch up."
John Daly opened with a 71, also finishing with a birdie on No. 9. He's making his sixth tour start since turning 50 in late April.