Transfer Case Encoder:
WARNING: This page is about a different car, the 2003 GMC Sonoma, 2003 GMC Jimmy, 2003 Chevrolet S10 Pickup, and 2003 Chevrolet Blazer. However, it is still accessible from the selected car via links, so may be relevant.
The encoder is mounted to the transfer case encoder motor assembly and is replaced only as an assembly. The encoder converts the sector shaft position, representing a mode or range, into electrical signal inputs to the transfer case shift control module. The module detects the position the transfer case is in by monitoring the 4 encoder channels, P, A, B, and C. These inputs translate into AUTO 4WD, 2HI, 4HI, NEUTRAL, and 4LO or whether the motor is still in transition between gears. The transfer case encoder channel circuits may be monitored using a scan tool.