What's the average cost to replace a transfer case 2003 Tahoe

No way of knowing cause it varies from area to area. New transfer cases run about $1700 to $2400 from GM and that is just the part. Maybe 4 hours labor (just a guess). Around $3000.00 give or take. You might find a used or rebuilt transfer case for much less, but you will be taking a risk with them. Perhaps it would be good if you talked to a local transmission shop to see what they would charge.

Thank You.

I have my 2007 Chevy Silverado 1500 4wd at a Chevy dealer and had purchased a CARMAX service contract when I bought this truck. The replacement was quoted to CARMAX at around $2,800 parts and labor and has been approved by my service contract. I had a $200 deductible on a prior repair at that same shop so I won't have to pay anything else for this transfer case swap. I was fortunate that I'd purchased this service contract when I bought my truck from that company.

I had the exact same problem with my 2007 Silverado 1500 work truck, intermittent grinding trying to shift from 4wd low to drive and vice versa. Also had transmission fail twice in 2 miles while driving to my dealer; engine kept running but my truck slowly rolled to a stop. At first the Chevy dealer told me "no problem found" but I demonstrated the grinding to my advisor; they did a minor repair but trans. was still malfunctioning. I paid $200 on that first minor repair and then their trans. mechanic diagnosed internal transfer case problem and my CARMAX warranty approved replacing it after they'd sent an inspector to the shop to verify the problem. I'm certainly happy that I purchased this CARMAX service contract as the new repair bill of $2,800 will cost me nothing.