Mulder opted to end his epic knock so not to catch Lara's landmark 400 not out as his side posted 5-626 on day two of the second Test in Bulawayo.
It was a surprise decision with the 27-year-old all-rounder close to a unique cricketing milestone, but he did achieve the fifth-highest Test innings, after being 264 not out overnight.
Mulder then took two wickets as South Africa dismissed Zimbabwe for 170 in their reply and forced the follow-on to see their hosts 1-51 in their second innings at the close, still trailing by 405 runs.
Mulder, leading the side for the first time as a depleted team take on their neighbours in a two-match series, hit 53 boundaries (49 fours and four sixes) in his knock.
With plenty of time still left in the Test, he was expected to bat into the second session to chase down Lara's 21-year-old record score for the West Indies against England in Antigua.
But Mulder turned down the chance and declared at lunch, later explaining he had no regrets.
"First things first. I thought we'd got enough and needed a bowl. And, secondly, Brian Lara is a legend, let's be real," Mulder said at the close of play on Monday.
"He got 400 against England (in Antigua in 2004) and for someone of that stature to keep that record is pretty special. I think if I get the chance again, I'd probably do the same thing."
"I spoke to Shuks (head coach Shukri Conrad) - and spoke about letting the legends keep (that record). Lara keeping that record is exactly the way it should be."
He had brought up 300 runs in Monday's morning session, scoring them off 297 balls for the second fastest triple century in Test cricket, and then passed Hashim Amla's record score for a South African of 311 not out against England at the Oval in 2012 and got to 350 in 324 balls.
Mulder returned figures of 2-20 in six overs as Zimbabwe were bowled out for 170 in their reply, although spinner Prenelan Subrayen was the best of bowlers with 4-42 on his debut.
Zimbabwe's 38-year-old Sean Williams, who had been sick and off the field during South Africa's knock, came in lower than usual down the home batting order at No. 7 but still scored almost half his side's runs with an unbeaten 83 off 55 balls.
Takudzwanashe Kaitano, who was bowled first ball in Zimbabwe's first innings, was 34 not out in the follow-on along with Nick Welch (11), and they will resume the third day's play on Tuesday.
South Africa beat Zimbabwe by 328 runs in last week's first test in Bulawayo and look well on course to win their 10th test in a row.
