Does it only make the noise in 4WD when backing up or does it also do it in 2WD?
BTW if it's a stock Jeep it will have the Peugeot BA/10 tranny and the oddball NP207.
The NP207 was only used in the 1987 YJ's. They switch to the better NP231 in 1988 and beyond.
The Peugeot BA/10 was only used in teh 6 cyls from 1987 thru March of 1989.
after that Jeep switched to the superior AX-15 tranny.
If it turns out it's the tranny I'd recommend you seriously consider not dumping any money into the tranny but to swap out the exsiting NP207 Peugeot BA/10 combo and replace it with an AX-15 and Np231 setup out of a slightly newer YJ.
Suggestions for places to find parts...
- Local Jeep forums
- Local junk yards
I have a "parts" Peugeot tranny in my shed. If you tear into the tranny and find a broken part let me know
I'd be happy to ship you the part(s) (if I have it) for the price of shipping.