I have been trying to remedy this problem for a few weeks. all of the indicator lights stay lit after i start my blazer (99, 4dr, A/T, 4 button 4wd switch). when they are lit, and i try to drive around, the blazer wont downshift on its own, (it will if i shift it into a lower gear manually) and has kind of a sluggish feel too it, also i can not get the TC to shift into anything besides 2wd when all the lights are on (all lights stay a on, no blinking what so ever)... I have checked and replaced vacuum lines, i have checked connections, i made sure all of the fluids are at the recommended levels.. etc. Pretty much what i am looking for is if someone had this same problem, and what they had to do to fix it. Every once in a while it will act normal when i start it, and i can hear the TCCM clicks before the lights go out leaving the 2wd light on, and everything works like normal..Thanks.

 

I would start by pulling the passenger side kick panel trim and having a look at the TCCM. Disconnect it and check the connection for corrosion.

Beyond that, have a look around. There are quite a few threads discussing problems with the NV236/NP236 transfer case.