I have an 89 Commanche truck that has been lifted 6" (before I got it). Here's the problem.  2 days ago I was using my 4 wheel drive and all was great. Today I noticed it is gone! I was fish tailing all over and pulled the 4x4 lever many times trying to figure out what was up. Also tried it in 4 low. Finally to confirm my suspicions, I got my wife and drove the truck to an incline with lots of snow at the end of my street. Had her stand next to the truck and watch the tires while I put it in 4x4 and stomped the gas. When I hit the gas, all I did was spin the back tires!
I crawled under it when I got home and the 4x4 linkage is fine going into the T-Case.  I noticed red fluid leaking from the T-Case, but could that cause a complete failure of the system?

The linkage from the lever in the cab leading to the t-case is all metal and works fine (had the wife pull the lever while I was underneath).  Going to check the fluid level in the morn....could low fluid cause it not to work?  I figured it was just a lube & it would whine or something first before stopping.  Like I said, red fluid was around the seals of the t-case.
Someone at work mentioned something about older jeeps using a vaccum system of some type that leads to the top of the front axle.  I checked all connections up there and it looks fine.
Perhaps I'll actually need to visit a dealer, but I HATE paying 90/hr here in Alaska for them to figure it out.

Exactly what I was thinking.

No noise in the T-case and no movement of the front wheels means you need to check that chain!

Driveline, what driveline?e   [:D]

Not sure how to check the front drive train without getting under it while its moving [:)]  Or I could jack it up on all 4's or put it on a rack.  Good ideas guys!

Is your front axle locked in with vacuum line to a big vacuum switch located on the axle?

Hoppy

The most probable cause, short of hearing any vicious noises, would be the vacuum system for the fron hubs.

Not being familiar with the Jeep line shortly after Chrysler bought Jeep from AMC, I don't know if an '89 would have the Mopar front axle yet.

The vacuum device on Dodge trucks has been very trouble free, but it would certainly be the first place I looked.

Check on the passenger side of the front axle. there should be a selinoid covered by a peice of metal. The selinoid is activated by a Vacuum from the Tcase IRRC so check the vacuum hose. Dana 30 under cherokees and camanches are notorios for this. There is cheep (insert washer) fix or a $99 pull lever swithc you can replace it with. Great place for info on Jeeps [url]www.jeepsunlimited.com[/url].

Gone?  Were you driving around when it happened or did you go to put it in 4x4 and nothing changed?  

I've never seen a chain just break without some sort of loud scary noises first.  You would definately hear those.  Leakage is normal and a low fluid level would affect the tranny, NOT the T-case.

You are right.  Put all 4 tires in the air.  Put it in 4WD.  See if that front driveshaft is spinning.  Even if the T-case is NOT locked in, the front shaft will still turn slightly.  You should be able to slow or stop it with your hands if this is the case.  But for fuck's sake be careful!!

Got automatic hubs eh?  Yup, make sure there is vaccum at the vac port on the front axle (when in 4WD).  There probably is.  

Now here is where things get interesting.  You have to make sure that BOTH hubs have engaged and the shaft splinds are not stripped.  Your differential sends power to the side of least resistance.  If you've got a blown hub then that is the side of leat resistance.  Therfore--No go.

I've seen many cases where one of the hubs strips out.  It does'nt make any noise when it happens either.  You'll be able to feel the vibration with your bare hand when you touch the hub if that is the case.

Let us know how you come out.

I suspect the automatic hubs. Are manual (Warn) hubs available to replace them? You being in AK  means it's pretty cold, and the slightest bit of water in the hubs that then freezes can cause one or both not to lock. Automatic hubs often cause problems in mud for the same reasons.