4lo always on?

Yep, when the chain wears out it will jump over the sprockets and make a sound. The light can be on because the transfer case actuator is stuck or needs replacement. If you upload a short video of the noise, I can tell for sure what's going on. Here is the location of the actuator and an exploded view of the transfer case and the chain that needs replacement. Check out the images (below). Please let us know what happens.