If you have the 13-56 case, the oil pump is spun by the output shaft. Shift t-case into neutral, ensure hubs are unlocked, and tow away. Transmission gear selection is irrelevant. If you don't know what t-case you have, figure that out before you "risk" anything. No magic/luck/smoke&mirrors involved here. If the output shaft is spinning the oil pump in the 13-56 is pumping. My only concern there is the front of the output shaft spins in a small caged needle bearing when the case is in neutral, that may not be intended for high speed (thus the owner's manual recommendation), but I'm not a t-case engineer.

 

My well driller buddy flat tows all his 4x4s behind his tender truck so they don't need 3 drivers. Lots of farmers do the same thing with hay trucks here, they leave the T-case in 2 high pull in neutral with the truck running. They never have problems. But if the truck doesn't run...pull the shafts or winch it on a flatbed

 

Good to know.

 

This method makes sure everything that might be needed to circulate the gear lube is turning, so it is very conservative. But it also requires the engine on the towed vehicle to be running, which isn't particularly desirable either, especially on long tows.

Personally on short tows (under 50 miles and 50 mph) I wouldn't worry about it too much and I'd just put the t.case in neutral. And on long tows I always unlock the front hubs and pull the rear driveshaft.

 

Fixed it for you (as it applies to the 1356 transfer case)!

Running the engine turns the transmission oil pump, which circulates fluid in the transmission, and only the transmission. As was previously mentioned, a Borg-Warner 1356 transfer case is lubricated by it's own internal oil pump which is actuated by the rear output shaft. As long as the transfer case is in neutral, you will NOT hurt the transmission. Even if you towed it around with the front hubs locked. The 1356 neutral position is accomplished by the range fork moving the range hub halfway between the high and low positions in the planetary gearset. Nothing would be rotating beyong a few internal t-case components, which would be lubed by the shaft-driven oil pump.

If you want to see this for yourself, park your truck on a small incline and put it in park (or in gear with the engine off and clutch pedal released for a manual transmission). Stay in the cab, shift the t-case to neutral and let off the brakes. Be ready for the truck to start rolling as soon as you release the brakes!

 

A 13-56 t.case uses transmission fluid to lube the gears, but it's still lubing the gears. Saying it circulates the transmission fluid implies it only refers to the fluid in the transmission, which I did not mean to imply. I'll stick with what I wrote.

And yes, putting the t.case in neutral protects the transmission. But I'm not talking only about the transmission. As I sais in my original post in this thread, I once met a very unhappy guy who had to drive a rental Jeep on his vacation because in the process of flat-towing his own Jeep out to Colorado he fried the t.case. Now I don't know what t.case he had (it almost certainly was not a 13-56). But I do know that he had been told that he could flat tow his Jeep with the t.case in neutral, and as it turned out, he couldn't.

So yes, the gear lube (which happens to be ATF) in a 13-56 t.case is circulated by a pump that is driven off the t.case rear output shaft. So as I said in my first post, it would probably be OK to tow them in neutral. But for longer tows, I don't think it's worth the risk. I'd drop the driveshaft.