How to increase fuel economy?

I had an '86 4x4 with a 2.4L V6, manual transmission that got about the 16 MPG. Engine rebuild went to 100 over, reground cam (grinder now out of business), shaved, ported & polished, heads and replaced 2 bbl intake manifold and carb with 4 barrel setup. It would turn 95 in 3rd gear (that was as fast as I wanted to go in it) and it got 25 MPG! However, the transmission kept tearing up so I gave it to charity.
Now I have a '99 4x4, 4.0L, auto, that is gets about 16 MPG of mostly highway use. It's nearing 300K miles so engine rebuild soon but does not use oil.

Q1) When I rebuild the engine all wearing parts will be replaced. Crane, Competition, Crower all advertise cams to increase mileage. Does anyone have experience (good and bad) with cams that claim to increase mileage?

Q2) From what I can read the axle ratio should be 3.55. What about changing to 3.21 or 3.07? Pulling power will be reduced but engine will be at a lower RPM at highway speeds. (But it may require more throttle thus negating the lower RPM saving.)

All suggestions/recommendations appreciated.

Ok, well the 4.0s are known for high to mid-teens for mpg. Its all in how efficient your engine is.
You probably have heard about doing a tune ups. My version of a good tune-up is plugs, wires, cap, rotor, air filter, oil change(tranny and engine), air filter, fuel filter, adjust TPS properly, adjust tv cable. Take a toothbrush to the inside of the throttle body and clean it with carb/throttle body cleaner. When you change your oil add a quart of atf to it first. Run it for a few minutes reving it up occasionally. Rev it to 2500rpm or so and hold for ten seconds and then let idle for ten seconds. Then change the oil. This will help remove deposites from inside the engine. Set your tire pressure properly. My 33's liked 38psi, my 35s and 31's liked 35psi. Dont change to 3.07s or anything lower then the factory gearing. The 4.0 is whats called an undersquare engine. It can cruise at 3k all day long at get 20mpg. Some users on here have stated before of getting up to 25mpg on multiple trips of full tanks of gas. They had 5.13's and 35's, were turning 3k at 70mph on the highway. Dont be afraid to let it rev high. Now if you rebuild it, consider a stroker. Higher compression engines can make more power and use less fuel to do so. Leaving you with higher mpg. Our street and performance section has good talk about different strokers you can build and which ones we have built. also, visit and join JeepStrokers.com for more info and a larger group of jeep engine builders.

Goodluck and welcome to .
----NorCalChris

Thank you for the feedback. I'll leave the differentials alone and work on the engine. Had not thought about stroking. Interesting idea. I'd love 25 mpg. After the rebuild there are a couple of shops nearby that put the car on a dyno and tweak the brain for the best performance. ;} Cheers!

2 things that are really important are intake and exhaust. aside from a tune up.. I would start with this : http://www.strokedjeep.com/tbody.html and a better air filter (napa gold at a minimum, amsoil, or green air filter). Then exhaust header of your choice, custom downpipe (without crease, if you have enough lift), and high-flow cat ad whatever muffler you want.

Don't forget, your new XJ has an auto slushbox in it... your old one had a standard. That right there is an efficiency loss, autos usually get 15-19mpg while standards get a couple higher than that.