Two problems related to transfer case have been reported for the 2002 Jeep Wrangler. The most recently reported issues are listed below.
Going down the freeway about 60mph around 5:30pm. Feel some humming from the vehicle follow by a loud high pitch. Then heard a loud band and parts started to fall on the freeway. The car was still moving without power and light. I was on the third lane of a five lane freeway. Cars behind me slow down and allow me to pull to the side. I was stop between an entrance and the freeway. After exam the car with the shop. The transfer case was broken into pieces. Called Jeep and was told to toll the car to a dealer. After dealer confirmed the transfer case was broken into pieces with no clue. Jeep refused to pay because warranty was due on 2004 even knowing the vehicle has only 6500 miles on it. This Jeep was parked in the garage most of the past years. And every time when I came back from oversea. Oil and filter change were service on the car. I don't believe a 6500miles transfer case will just blow up.
When driving on ice or snow the 4-wheel drive kicks out, causing vehicle to jerk and potentially slid. No impact had been reported. The vehicle was in motion when it felt as if the transmission dropped out. The vehicle had to be stopped to get back into 4wd. The lever was held tightly and popped out again. The vehicle was driven in 2wd for several miles then was able to be placed back into 4wd and stayed. Also, the upholstery had started to tear on the driver's seat and the gaskets on both mirrors deteriorated.