transfer case noise
 

2001 Dodge Dakota Sport 4.7L transfer case noise
2wd works great-no noise at any speed.
4HI quiet on start out but starts at about 15-20 mph and emits kind of a low grinding/howling noise
4 LO same noise but is much louder and comes on as soon as the vehicle moves
I did not try it in reverse
Stopped:
4 HI light comes on and can hear what sounds like it is shifting. Light is solid.
4 LO light just blinks and sounds like it is trying to engage.
I bought this truck a couple months ago with around 145,000 miles and because of all the snow we now have I had not really tested the 4 wd
Any suggestions will be appreciated
Thanks, Tom

First thing I would do is check the fluid. Take out the top plug with a giant alen wrench. Its trans fluid so it should be red and full all the way to the plug. If its not full and/or red I would drain it and refill it with fresh stuff. ATF+4. cheap and easy to try and hope its not ruined.
Also inspect the drain plug for metal shavings if you do this. I think it has one if I remember correctly.
I replaced THREE stupid transfer cases on my old 2001 dakota 4.7 so transfer cases and I have a special bond.