Is there a way in which I can remove the rear leafs from the suspension and put coils instead? Kind of like how the zj is set up? The leafs sag a lot and I think adding coil springs instead would get rid of that problem and add extra flex of the rear axle..

That is a big task... try www.pirate4x4.com (I recommend searching)

It's very possible and a lot of people do it. I'm doing this to mine over the winter. Ballistic fab has a lot of stuff you need or if you have the dough you can get the whole kit minus shocks and springs from rock krawler.

Staangs fab carries a kit for this.

http://staangsfab.com/products-1/jeep-cherokee-xj/

And their stuff is Pure beef. Control arms double as rock sliders. Nuff said.

I didn't know staang was selling these now! I read his build thread while he was making his first set... years ago!

Clayton's also has an 8" rear coil conversion kit. Mucho expensivo though

Thanks guys. I will get on this soon

If you are asking if you can ,I m gathering this might be something way over your head.(not being a ***** to you but there are so many guy's out there trying to do things they shouldn't be allowed to touch) this will require some major fab work with major welding,etc. also must be done right and safe so when you drive it on the road you don't kill or hurt yourself or someone else more importantly.But g/l .

staangs fab.

they are about an hour from the Niagara border.
eric and billy will hook you up for a fraction of the cost of a comparable (clayton's) kit.
and, they stand behind their product much better than any of their competition. if you break, bend or damage their product in any way, they will replace it.