1998 Jeep wrangler s/spot stuck in 4 wheel drive

this is part time 4wd, selectrac, and is NOT AWD, all wheel drive
you dont have Quadra-trac do you....

this is driving wrong,
ever read the operators guide yet?
it says not to drive on dry pavement in PT 4wd
dry means , not iced.

are you doing this>?

http://www.rubicon-trail.com/4WD101/driveline-bind.html

my 89 light is always on to,but its not in 4x4 mode,its a vacume problem.the shifter should be in 2h.to test if its stuck in 4x4 turn the wheels to the left or right all the way and try to move a little if it feels like its binding its in 4x4.if not you ok.

Best way to attain engagement without any grinding etc. is to pull 4x4 lever into gear while rolling at low speed. You can also in an emergency, turn the engine off and engage, then re-start (when you have been in 2wd and have gotten stuck in mud and can't roll) When dis-engaging, generally it will shift out with no problem while moving, but if it does not, then you can back up about twenty feet and usually that will work. (still beats getting out and doing it manually at the hubs!!)

The front axle connects 4wd by vacuum. check the vacuum hoses that run to the actuator. Pay close attention to the vacuum hoses running underneath the battery as battery acid can eat thru those hose easily. Good Luck.

Assume that is stuck in 4wd, cannot shift back to 2wd. Have you tried shifting to 4wd/Lo and back? Try letting out on the clutch while slowly rolling?

Assume you are manual transmission?

Has this Jeep been modified at all?
It sounds like the shifter cable was reinstalled backwards.
Specifically the 4-Low "Not Climbing Well". 4-Low should give you the best torque and hill climbing ability.
Do you feel any "Binding" in the steering wheel (difficult to turn)?
Remember a Jeep uses real driveshafts and differentials to give you 4WD - you cannot engage 4WD or 4-Low on dry hard surfaces. It needs a little bit of slip between the wheels for turns.
Check you're fluids too.

Try putting the car in neutral first. Try going in reverse while shifting out of 4wd.

If you are saying that the transfer case is stuck in 4WD, you may have to get under the vehicle, and look at the transfer case, on the front, you should be able to see where the 4WD shift lever hooks to the linkage. If it is disconnected/broken, take a pair of channel locks, or pliers, and pull the shaft you see coming from the transfer case. this will disengage the 4WD. Unfortunately, if you cant pull it. You will have to get someone to put the vehicle in Drive, and creep forward while you pull it. Make sure their window is down so they ear you say stop.

if u got automatic front hubs stop put in park pull 4x4 shifter into 4 wheel
manual hubs at front wheels turn the hub locks to the lock position and then pull the 4 wheel shifter inti 4 wheel
also look over drivers sun visor if the tag aint worn off the direction are there... have fun 4 wheeling and keep the rubber side down
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I also have a 1998 jeep cherokee sport, i was having the same issues so i asked my uncle who is a mechanic.. he told me since the jeep automatically locks the hubs when you put it in 4 wheel drive, sometimes the hub locks get stuck trying to unlock, to solve this when you switch back to 2 wheel drive, reverse like 10 - 15 feet, the wheels spinning the opposite way help unlock the hubs, since i started doing this as soon as i reverse i feel the 4 wheel drive unengage and have not had a problem with it since, give it a try and see if that fixes your problem