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I've recently seen somewhere that a 1" engine lift is recommended with a 1" body lift. Wouldn't raising the engine make your driveline angle worse? What other benifits are gained from the 1" engine lift?
 

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Lifting your engine has the effect of lowering the rear output of the t-case and angling it downward (it pivots on the t-case mount). Especially on TJs this combination is often a perfect match for the change in rear pinion angle with a 3"-4" lift.
The front drive shaft is a CV, so the increase in angle on it doesn't usually matter.

The other reason to do it is what I have done. I raised both the engine and t-case, then had a custom t-case mount made that gave me 1" more clearance.
 
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