I have a 2001 SR5, and the 4wd dash light constantly flashes, and its stuck in 4hi. I have checked the 2 sensors on top of tcase and the 2 on actuator. I took out the front acutator and cleaned and lubed the motor. plugged it in and nothing.

 

There are 4 sensors on the transfer case and 1 on the front axle. You can’t tell if they are working by looking at them or even by feel.

You have to connect a voltmeter and test for continuity thru the range of its motion. If there is any dead spots, replace it.

If all the sensors check out then your issue is probably in the transfer case actuator. We can cross the bridge of we get to it.

 

I checked the 4 sensors on the tcase and actuator, they test fine. It is a 2001 so no sensor on front axle, but may be one inside the differential. 4wd switch tested fine, fuse is good.