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According to my 2001 owner's operating manual it is for the Sentry Key Immobilizer System (if your car is equipped with it). This system uses a special key with a 'chip' installed (and programmed for your car). If you have the proper key you may start and drive the vehicle. If you have the wrong key your engine will quit running after 2 seconds.

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Q: On a 2001 Jeep Cherokee Larado what does the dash indicator of a key with a line through it mean?
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