4 wheel drive problem

The reason the light is flashing constantly is because the vehicle is sensing that four wheel drive(4WD) is not working. These 4WD systems use vacuum from the engine to engage/disengage to front axle. The vehicle probably has no vacuum going to the front axle, which would not allow the 4WD shift to complete, which would then leave the light on the dash flashing.
First thing to check is that the vacuum actuator on the firewall is working as it should.

when deactivating youre four wheel drive make sure youre rig is in nautral this helps with the gears lining up. whan youre 2-hi light flashes hit a second time. Ive had this problem befor.

First try hitting the 2HI when in nuetral. If that doesn't work put the vehicle in reverse and hit the 2HI switch and tap the brakes at the same time. Usual if you do this, when you put it into drive it will release.

my 99 jimmy shifts into 4lo all the time.
1. Turn truck off
2. set parking brake
3. start truck and shift into neutral
4. push 2hi button(should shift back)
put back in park,release brake
might work for you

You should be able to put in 4x4 while in drive less than 35mph. Mine had a switch to turn to engage or dis-engage.

On a 1996 GMC Jimmy 4 wheel drive
Why is it reluctant to coming out of 4 wheel drive? Switch must be working when activated, you can hear it clicking but it won't release into 2 wheel drive, even when backing up and turning the wheels!

Check the wheel bearings.

I have had the same problem with my 2000 jimmy. Disconnect the battery for approx 1 minute and then reconnect, this should reset the computer. It has worked for me every time. I was told it was a glitch with GMC.

You need to see if the transfer case engagement motor is defective.

Does it sound like a loud winding sound coming from the front right side? I have a 2001 Jimmy and the 4wd tries to engage when driving up steep hills and going at highway speeds. The actuator vacuum switch engaged when the transfer case vacuum switch sends the vacuumed air to the actuator. What is happening is their is either a leak in the vacuum lines, a faulty actuator switch, or a faulty transfer case vacuum switch. When the jimmy has enough air pulling in, the extra vacuum is trying to push the actuator switch in when it is not supposed to. It is a much cheaper fix than a transmission. GMC should have recalled the whole 4wd system on any of the S10's, the JImmy's, and Blazers.