I just picked up an 01 XJ with 150k miles, I thought it just ran a little warm (~218) until suddenly it just skyrocketed and wouldn't go down.

I pulled the fan off of it and added tension to the clutch spring and forced it to stay in high
I checked the coolant and it was right at the top of the radiator and didn't look very dirty
The electric fan on the driver side kicks in when it goes above 210
Its had a new water pump and thermostat put in it less than a year ago
I ran it several times and the same thing happened each time it ran great for ~20 minutes staying only ten degrees hot then after running for that long it shoots to 260 in less than a second and stays there
I know it's not a temp gauge issue because you can feel the heat coming off the engine and starts smoking the grease on the valve cover
This is my first XJ and I'm wondering if anyone knew any little quirks that would cause this I've been a mechanic for a number of years and I haven't seen one that just decides it wants to be hot suddenly like this if anyone could give me any help let me know

These things are known for cracked heads in certain years. Im not familiar with the cassting numbers of the faulty heads, but im sure someone will chime in with the answers, but im pretty sure 2001 is an affected year. pull the valve cover and get the casting number. Head replacement is an easy quick job.

The only thing is there's no smoke out the tail pipe, the oil looks clean and it's not appearing to lose coolant

The only way I can think for the actual coolant temp at the sensor to go from 218 to 260F in one second would be if the heater core was clogged. The heater core flow provides an alternative path for water flow when the tstat is shut. If the heater core is clogged, there is no means for hot water to easily circulate past the coolant temp sensor and reach the tstat. When the near-stagnant water at the tstat finally gets hot enough cause the tstat to open, there will be a rush of very hot water going to the sensor.

Otherwise its a sensor issue.

Oh definitely not sensor issue because it got hot enough to melt the cover on the fuel rail

Apparently you just got this thing.

"It had a new water pump and thermostat a year ago"

I assume the previous owner told you that.

They would be my first suspects

Never hurts to check. Takes about 5 minutes to take the valve cover off. The head casting will be 0331, somewhere near the cylinder 4 exhaust port. Cracked head doesnt necessarily cross fluids or burn through exhaust. Might just push combustion into crank case or through the coolant.

If you have an IR pyrometer, measure the temperature of the heater core hose during the lead-up to the sudden temperature change. If the heater core is clogged, it should be relatively cool.

Or if you want, you can try bypassing the heater core. I'd do it by running a piece of hose from the tstat housing to the heater core return pipe. Its easy to mess up the heater core by pulling off the hoses.

pull the water pump....the impeller sounds like it has dissolved.

There have been so many times that a previous owner has said work had been done, and the new owner finds out that it hadn't been done.

Well I pulled the thermostat off and come to find out that it was completely dry behind it the previous owner must have filled it while it was not running so the thermostat never opened and it stayed low

BTW
Now that you know for sure the thing has overheated who knows how many times all the more reason to see if it's got a 331 head in it and if it does keep an eye on it.
They don't all crack, mine hasn't, but overheating them can be the kiss of death.

And check the water pump.. you've figured out how much the previous owner is worth

Don't have to pull the valve cover even. The 0331 will be on the driver side on the boss next to the rimm in the middle of the valve cover edge in the casting. Also can pull the oil cap out and look inside and you will see the number between the 3rd and forth cylinder valves. If it says Tuppy then that is the better one. I have the 0331 and a 2001 and have had overheating when I first got it but have since installed a relay and a switch in the dash to the electric fan . I can turn it on any time It is hot like when it is 96 or above and I want to use the AC. I just put on the electric fan and it says nice and cool 195 to 205. It is suppose to come on at 210 but mine never did.