GMC 2016 Sierra Denali Owner's Manual page 204

Shifting Out of N (Neutral)
To shift out of N (Neutral):
1. Set the parking brake and
apply the brake pedal.
2. Turn the ignition to ON/RUN
with the engine off.
3. Shift the transmission to
N (Neutral).
4. Turn the transfer case knob to
2 .
After the transfer case has
shifted out of N (Neutral), the
N (Neutral) light will go out.
5. Release the parking brake.
Caution
Shifting the transmission into gear
before the requested mode
indicator light has stopped
flashing could damage the
transfer case.
6. Start the engine and shift the
transmission to the
desired gear.
Automatic Transfer Case
Use the transfer case knob next to
the steering wheel to shift into and
out of four-wheel drive.
Indicator lights display which setting
the transfer case is in. N (Neutral) is
indicated on the face of the knob.
The indicator lights will display
briefly when the ignition is turned on
and one will stay on. If the lights
display momentarily when the
ignition is in ON/RUN, but none stay
on, the knob may have been turned
while the vehicle was off. To see the
indicator, turn the knob to another
position so that it matches the
Driving and Operating
actual transfer case setting. If no
lights display, take the vehicle to
your dealer for service. An indicator
light flashes while shifting the
transfer case and remains
illuminated when the shift is
complete.
If the transfer case cannot make a
requested shift, it will return to the
last chosen setting. Turn the knob
back to the previous transfer case
setting to see the indicator.
The settings are:
N (Neutral) : Shift the vehicle's
transfer case to N (Neutral) only
when towing the vehicle. See
Recreational Vehicle Towing 0 331
or Towing the Vehicle 0 331.
2 (Two-Wheel Drive High) : Use
for driving on most streets and
highways. The front axle is not
engaged. This setting provides the
best fuel economy.
AUTO (Automatic Four-Wheel
Drive) : Use when road surface
traction conditions are variable.
When driving in AUTO, the front
axle is engaged, and the vehicle's
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