Originally Posted by djustin973

Had the same problem with my 300sdl. Turned out to be the diff. Two large pins connect the carrier and ring gear. After 20 years and 400,000 miles the pins had opened their mounting holes into 2 inch slots! Every time power was applied the ring was clanking against the pin making a very ugly noise. Especially when downshifting! The easiest way to tell is put the parking brake on and put the car in neutral. Get underneath and try to turn the drive shaft. With a good diff you should get maybe 5 degrees either way. On my diff I was able to turn the drive shaft a full half turn before it stopped and made a familiar clank. Check your diff!

I found a picture. That slot should be a hole the size of that pin. Pretty huh?