The Tickford Racing driver was one of the early pace-setters in the half-hour session, jumping to the top at the 10-minute mark with a 50.969s.
He was then shuffled down the orders as others improved, the likes of Chaz Mostert, Jack Le Brocq and Anton De Pasquale all enjoying stints on top.
De Pasquale looked to have sealed up top spot with his late effort, only for Waters, who started his last lap just seconds before the flag came out, to pip him by 0.02s.
“It’s a pretty good start to the weekend,” said Waters, who also topped this morning’s first session.
“In saying that it’s only practice and everyone is on different plans. We won’t get too carried away, we’ve got to make the car a bit nicer yet. But a really good start.”
Shane van Gisbergen ended up third fastest ahead of Le Brocq, while Chaz Mostert was fifth despite being just a tenth off Waters.
The Top 10 was separated by just over two-tenths, Mark Winterbottom leading Scott Pye, Will Davison, Jamie Whincup and Todd Hazelwood.
There was less than eight-tenths to the back of the field, Andre Heimgartner slowest after catching traffic on his green tyre run.