2000 silverado with a 5.3...Checked tranny, front and rear ends, and transfer case fluids all were good. Any ideas what it might be??

 

Same thing happened to my 2000 Z-71 4 wheeler. Some kind of control module on the transfer case need to be replaced. Dealer fix it!

 

my 2005 did same and even drove like crap 1 time. It it the 4 wheel drive control module. You willneed to get it ti the dealership while light is on, and do not let the clear light to get milage (if so equiped). They did this to me multiple times before I caught it. If code is not currently showing they claim they can find no problem. The problem will get worseand more frequent. Quick fix once they see it. Also if you have push button 4-wheel all choices will be lit up - ex : 2wd, 4wd hi, 4wd lo, N all lit up.