4x4 engagement problems. 2500hd

[longblue72]

Hey all,

I have 2004 2500hd that i acquired about 3 months ago with roughly 127,000 on it and is floor shifted to engage 4x4.

Before yesterday, 4x4 worked. It had been a couple weeks since i last engaged it until yesterday. I went to shift into 4hi and got no lights on the dash saying it was engaged,nor 4x4. Today after work i checked the fuse, and it appeared good but replaced it anyways. When i went to test things out, i got the same thing; no dash indicator, nor 4x4. I went to engage 4lo and it took. I put it back into a 2hi, then tried 4hi again- got nothing, and when i tried 4lo, i had a grinding noise come from underneath.

Does anyone know what could be the issue?