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I am not a mechanic so I cannot attest to having the right answer to your problem here.

However, since I just recently was suffering the same symptoms with my 99 K1500 that you are, I can tell you what the cause was in my case:

The problem was the 3rd & 4th gear pack clutches were completely trashed. In fact, when we took the 60 transmission out of the vehicle, there were more than 26 different components within it that were actually broken/cracked.

By the time my transmission guy completed the construction and installation of an Allison 80 (3/4 ton) tranny in the vehicle, I was out some $6K.

I hope this is not the case for you but from the sound of things, its not good.

Best of luck...

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Q: Why doesn't your 1999 GM Suburban transmission shift into a higher gear than 1st 2nd and reverse?
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