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The spring loaded plunger on these shift mechanisms sometimes became bound up when the boot on the plunger mech became torn, the result was the inability to move the shifter in the gate. I would suggest you remove the shift linkage from the shift mechanism by prying (carefully) the linkage off at the plastic grommet. Once it is off, see if you can shift the transfer case by hand using the link. It is stiff, but you should be able to select the gears. If you can't shift it, then it's in the T Case. If you can shift okay, then remove the shifter mech (see below). Once out of the vehicle make sure the pivot bolt is not seized... then make sure the shifter is able to push the plunger down, if the plunger won't move, the shifter cannot move in the gate shown below. If necessary, remove the boot at the top of the plunger and spray penetrating lube down it. You'll be able to see how it works once removed from the truck. This problem was commonly cause by this shift mechanism becoming contiminated with dirt and water. Steve
CAUTION: When removing the control rod from the shift control selector lever, do so very gently so as not to damage the shift control selector lever.