Do the following, and it should allow 4WD to work. If it doesn't, then you have a component failure and will need further diagnosis.
Diagnostic Trouble Code (DTC) Clearing
The transfer case shift control module is equipped with the ability to store diagnostic information which is useful to a technician in the event of a module, component or wiring failure. DTCs should not be cleared from the transfer case shift control module until these codes have been recorded or servicing the system has lead you to a repair and directed you to perform the "Clearing Flash Codes" operation. The following steps provide an easy way of clearing the flash codes properly.
Turn OFF the ignition.
Remove the 10 amp CTSY LP from the I/P fuse block, and the 20 amp ATC fuse from the underhood fuse block.
Important: Replacing the fuse before the specified time may result in not clearing the DTCs.
Wait a minimum of 60 seconds before replacing the fuse. Once the fuse is replaced DTC 1 will be set in the transfer case shift control module.
Cycle the ignition switch from the OFF position to the RUN and back OFF five times in order to clear DTC 1 from the transfer case shift control module memory.
Verify that the DTCs have all been cleared. Refer to Diagnostic Trouble Code (DTC) Displaying.
Tuesday, December 18th, 2007 AT 9:32 PM