Volvo: over drive, overdrive system, ash tray

Question
QUESTION: Hi, I have a 1990 740 GL. Recently it started disengaging the 4th gear and the overdrive light started comming on without me pressing the button on the gear shift. it goes away after abt 15~20 mins. I am not very car savy and I wanted to know why it is doing this and how it can be fixed. Is it a very serious issue?

ANSWER: Smriti,
Most common fault with the overdrive system is the relay. The relay is in the same panel as the fuses. That is behind the ash tray. You can try a new relay. It costs about $50 for a new one. It is the white relay 3523804.

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QUESTION: Thank you for your reply. Just to clarify things, is the relay physically responsible for disengaging the gear?

Answer
Smriti,
There is a solenoid on the trans that gets power via the relay. If it does not get the power OD will not work. Thats not to say that the solenoid could be defective or something wrong in the trans and getting the power and still not allowing OD to work. The button and relay are to take the trans out of OD, say for pulling a trailer going up a steep grade, etc.