sounds like a possible transfer case issue,possible bearing going out or something inside could be loose,check fluid level also..

 

My transfer case does have a bit of a drip to it, Its not LEAKING fluid. Just keeps getting a little wet with it.

 

Well the snap ring is still in the T-case...Anything else?

 

What's the fluid level in the t-case look like? (there is a plug about halfway up to check fluid level. Fluid should be just below that hole.)

 

fluid was low and black, Does the T-case take tranny fluid or gear oil?

 

ATF+4, same as your transmission.

 

well, I guess today ill just take the t-case off and look inside..

 

Took the case apart, No fluid. So i filled and re-sealed the whole case. I only found one snapring in the output part of the case (I think there should be two?) other then that i've put it all back together and the noise is STILL there?

 

Are you sure it is coming from the t-case? If so, running it without fluid likely damage bearings and such.