Axle shaft seal?
 

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I'm putting the Jeep back together after adding new parts. I noticed when I tighten the axle nut that the white plastic piece (see pic) is not flush like on the other side. I think this is an axle shaft seal. Has anyone had this issue? I cant tighten the hub anymore and I think I may have tightened the nut on the axle too much. Any help would be appreciated

Those are just dust seals and aren't really necessary I don't even have any on mine.

Thanks. What keeps debris out? Will this not allow water into the differential?

There are axle seals in the pumpkin side of the diffs. Those dust covers just keep debris out of the axle tube and do a ****ty job at it.

If you want good outer axle tube seals look at something like the 10 factory