4x4 lights blink 2 times and goes out and car wont go in 4 x4 or 2 wheel drive

A blinking service 4x4 light would indicate there are DTC'S - diagnostic trouble codes set . Need a professional scanner to pull these codes , not autozone or advance etc.... How many buttons on the shift selector ? Four or three - this would tell me which transfer case it has an capabilities .
The NVG 263 transfer case features a three button shift control switch located on the instrument panel.
The NVG 236/246 transfer case features a 4 button shift control switch located on the instrument panel
Both systems have a electronic control module .

SERVICE 4WD Indicator
The SERVICE 4WD message is displayed on the driver information center and is an integral part of the cluster and cannot be serviced separately. This message is used to inform the driver of the vehicle of malfunctions within the automatic transfer case (ATC) system. The SERVICE 4WD message is controlled by the transfer case shift control module via a Class 2 message.

Upon seeing this message it is intended for the driver of the vehicle to take his vehicle to a qualified repair shop that has the knowledge an diagnostic equipment to trouble shoot the problem .
These systems can set many codes an without knowing which or if any are set at all you could end up replacing parts an still not fix the problem .
DTC B2725
DTC C0300
DTC C0305
DTC C0308
DTC C0309
DTC C0310
DTC C0315
DTC C0323
DTC C0324
DTC C0327
DTC C0362
DTC C0367
DTC C0374
DTC C0376
DTC C0387
DTC C0550
DTC C0611

Your best bet , take it to a qualified repair shop .

What year is the truck ? Probably has DTC'S - diagnostic trouble code or codes stored in the transfer case shift control module. These would point to the problem .

Sounds like a relay to me.

try selecting from nutreul or less then 3km

the motor on the back of the transfer case may be stuck knock on the motor lightly with a hammer when switching the the switch May need a motor

Try replacing the vacuum lines that go to the transfer case from the engine. I had the same problem on a 95 Jimmy and was told to do it.... I changed every piece of vacuum hose that had anything to do with the 4x4 and it worked. Hope this helps you out

look on fire wall pass. side you will see 2 parts with vacume lines attached 99 percent of the time that is what went i had the same problem

try putting your truck in neutral and then shifting into 2 wheel drive shift on the fly does not apply to 4 low only 4 high and on electric shift models it wont shift unless your ****** is in neutral.