Londoner Wiggins climbed two places to fourth in the general classification after posting a better time than all of his closest rivals in the 40.5 kilometres circuit around Lake Annecy on Thursday.
The Garmin Slipstream rider overtook Andreas Kloden and Frank Schleck in the GC and narrowed the gap to Lance Armstrong, who is now third overall, and Andy Schleck, who remains second.
Making up 85 seconds on Andy Schleck over the last three days may be too much to ask but Wiggins could surpass Armstrong, who is only 11 seconds ahead.
The penultimate stage, which has a mountain-top finish on Le Mont Ventoux on Friday, appears the best opportunity for Wiggins to climb into the top three.
Britain's David Millar was fifth in the time trial, two seconds quicker than Wiggins, but it was Contador who wore the broadest grin last night.
The Spaniard won the stage by three seconds from Switzerland's Fabian Cancellara to strengthen his vice-like grip on the maillot jaune.
Contador, the 2007 Tour champion, now has a lead of four minutes and 11 seconds on Andy Schleck and will be extremely confident of completing the job over the weekend.
"Winning a time trial in the Tour de France is really special. And I beat all the specialists," he told French television station France 2.
"We are near the end but there are still three days left. I must be careful."