I have a 2000 Grand Cherokee Limited automatic with Quadrs-Trac II, and 4.7 v8.
Recently whenever it moves a more than a few mph (more noticeable in reverse) the back end seems to grind, and it feels like it's dragging on the ground.
The rear differential has been leaking for a while (haven't had the money to fix it), and the ABS light came on shortly before this happened. Additionally, the dash brake light has sporadically come on and off for the last few months.
When this happened, while loading it on the tow truck, the back wheels were locked in neutral until a loud pop, and then they spun fine.

 

I just had my rear axle blow up because the carrier assembly cracked and the planetary cross shaft pulled out of the carrier. Here's what it looked like when I got it open:

 

To the OP, I would look at your wheel bearings first thing. You will have to pull the axle to do so but I suspect with the brake issues etc that they are not good