Career-best figures by Andre Adams and three wickets for Graeme Swann gave Notts the edge against Lancashire.
The reigning champions were set for a first-innings lead but lost their last six wickets for 16 runs as they were all out for 146, Adams taking 7-32.
Stephen Moore’s 43 was the top score, while the only other real resistance came from Ashwell Prince (23) and Steven Croft (20).
But when Luke Procter was trapped leg before by Swann, the collapse of the Red Rose batting was startling.
They lost their last six wickets for just 16 runs as the nightmares of early season defeats came back on Lancashire’s return to Old Trafford.
Swann (3-26) dismissed England team-mate James Anderson first ball, who then did not field due to illness, but Stuart Broad finished wicketless.
Notts closed 145 runs ahead on 122-2, with Michael Lumb unbeaten on 40 and they go into day three very much in the box seat.
Meanwhile, Somerset have confirmed they are considering taking action against Chris Gayle after he backed out of a deal to join them for their Twenty20 campaign.
Opening batsman Gayle, 32, agreed to be Somerset’s overseas player in January and was expected to arrive in June. But the Jamaican has decided to return to the international fold after resolving his differences with the West Indies Cricket Board.
Somerset have brought in ex-Ramsbottom pro Francois du Plessis as replacement.