Removal Procedure

Start vehicle and shift the transfer case to 2WD/2High.
Turn the vehicle off.
Disconnect the battery negative cable. Battery Negative Cable Disconnection and Connection (9C1/5W4) , or Battery Negative Cable Disconnection and Connection (KL9)
Raise and support the vehicle. Lifting and Jacking the Vehicle
Courtesy of GENERAL MOTORS COMPANY

Disconnect the transfer case two/four wheel drive position sensor electrical connector (1).
Courtesy of GENERAL MOTORS COMPANY

Transfer Case Two/Four Wheel Drive Actuator Position Sensor Bolt (1) - Remove [2x]
Transfer Case Two/Four Wheel Drive Actuator Position Sensor (2) - Remove
Transfer Case Two/Four Wheel Drive Actuator Position Sensor Gasket (3) - Remove and DISCARD
Clean the gasket surface as necessary.