Have a friend you just bought a 2002 jeep liberty sport with a manual transmission with the 3.7 and when he engaged the 4-wheel drive and tried putting in back in 2wheel drive the lever will go to the 2-wheel drive position but the part time indication light will not go off feels like its in 2wheel but wont to see if anyone else has had this problem.

 

Try searching JeepKJ.com
Its a Liberty forum, and I think I have seen that issue over there before, and think its just a sensor, as long as it feels like its actually in 2 wheel drive.
Also does the T-case lever have any difficulties moving?

 

Thanks for the web address...The t-case has no problems moving in and out.

 

yes its a $70 sensor.

transfer case position switch: Part number 5083138AA


excellent how to:
http://www.jeepkj.com/forum/showthread.php?t=44188

 

Thank you that how to is great!