The Slip Yoke Barrel Is Burred, Nicked, Corroded, Or Worn
Inspect the slip yoke for burrs. Minor burrs can be removed by careful use of crocus cloth or fine stone honing. If the is badly burred, corroded or worn, replace the yoke. See SLIP YOKE under REMOVAL & INSTALLATION in appropriate DIFFERENTIALS article in DRIVELINE/AXLES.
Replace the oil seal. See OUTPUT SHAFT SEAL under REMOVAL & INSTALLATION in appropriate DIFFERENTIALS article in DRIVELINE/AXLES.