Howdy!
My 86 is approaching 300K. My trans leaks like the Exxon Valdez! I have new shifter boots from Marlin but it seems that the trans oil is leaking into the transfer case,I notice oil pushing up past the transfer case shift boot. Is there a seal between the tranny and transfer case? The level in the tranny is too low and too high in the transfer case. Thanks!

 

There is a seal between the tranny and the transfer case on the W56 ( I expect that your '86 model Runner is equipped with this tranny)

The seal seats in the rear of the tranny case and seals against the transfer input shaft that extends into the rear of the tranny.

Hard for me to believe that that seal could become seriously compromised unless there is serious slop in one, or more of the bearings on either side of the seal in the tranny, or the T. case, but if your trans is losing oil while the T. case is filling up, it's gotta be going thru that point.

 

If the vent is plugged on the Transmission it can be forcing fluid past the seal into the case .

Once the fluid is in there it can`t get back.

Making sure the vent is clear would be my first step.

That might cure your problem

If you have a body lift you might have enough room if you need to change that seal without pulling the transmission

I found out the hard way on a stock vehicle it is impossible to get the T case in with that seal installed mine got left out years ago to no ill effects that I can see

 

Vent is clear, first thing I checked. I expect he bearings are worn internally. It only howled in 5th but now 3rd and 4th are kinda noisy too.

 

Likely a new seal won't hold up long then. Maybe tranny overhaul, or different tranny time.