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The overdrive will only come into use when the transmission module reads the correct revs/ road speed ratio. Switch if off for heavy city traffic driving to improve economy when it moves up and down all the time. No it will not harm the transmission otherwise.
Transmission Overdrive Off. Likely a push button switch on the dash to control this; some driving conditions are better coped with without overdrive(more power for towing, etc) but ordinarily you would want OD on for economy.
Ok, make sure the tcm is connected properly. there is a o/d shift solenoid that is controlled by this device(tcm/pcm). if the wires and module aren't connected properly or, if the tcm/pcm is malfunctioning, it will render the OD inoperable. inspect the tcm and wires on the trans for correct connections and fit. test the module for its operational value and, pull the pan on the trans to test the OD shift solenoid as well.
i think you might mean "od off". that means overdrive for the transmission. the button for that may be on the shifter handle or a button on the center dash board. unless youre towing or need a bit extra power you would generally leave it "on" with no lite on dash