1991 Volvo 240 overdrive goes on and off while driving

Check vacuum lines for leaks.

All the ones I have come across have it. Basically it allows gearbox and engine to sync for greater fuel economy when you are not 'town driving' I.e doing more than 25 MPH. I've always left my overdrive engaged as you usually get better fuel economy. To try, take it onto a long open road, engage overdrive and bring her up to speed. Then turn off overdrive and watch your fuel gauge. You can pretty much see it drop.

What is happening is the tranny is going. They can try to replace the selenoid, but really, you need a rebuild. Whomever charged you to remove the light, probably messed things up more. Volvo's typically lose overdrive before losing all the other gears. It is time for a rebuild. Go to a reputable tranny shop who knows volvos.

When the button is pressed and the arrow indicator light is on the overdrive gear is not being used and you only have 3 speeds. When the button is pressed and the light is off you have overdrive. Normal use you should not see the arrow.

Remove the right kick pannel(glove box side) of the center console. The relay is attached to the firewall side of console metal sopport frame, about even with the blower switch.

You need to replace the overdrive relay located inside the center cosole on the right side about even with the blower switch.

Hey try this. Buy an over-drive bypass plate from IPD (www.ipdusa.com). I had the same problem with my 91 Volvo 940 Turbo. My overdrive solenoid went out, but that would have been $160 to replace. The bypass plate was only $40 and it fixed my problem.

More likely that the solenoid in the transmission is shorted to ground. Has any new electronic equipment been installed recently, like stereo, alarm, etc?

when driving overdrive kicks in sometimes it will go off

The service light is a reminder for you to have the car serviced, it can be reset, and it will come on again in 5,000 miles or so.

The overdrive light may be caused by the wiring to the overdrive solenoid on the transmission, or the relay. Just be sure the wiring is ok before replacing the relay, or you can damage the new relay.

Bret
RepairPal.com