I have a 1992 Automatic Wagon.  Transmission is fine and AWD works fine.  
While the (green light) diff-lock will switch on and off, I notice no difference in steering or traction in the snow or mud.  
My mechanic suggested it likely is a fried solenoid.  Is this likely, and how complex would it be to replace the solenoid?
Thanks!  

Quoted from westcoast

I have a 1992 Automatic Wagon.  Transmission is fine and AWD works fine.  
While the (green light) diff-lock will switch on and off, I notice no difference in steering or traction in the snow or mud.  

  By "no" difference are you saying that when you engage the AUTO function, you don't notice a change in the drivetrain response?  If so, then perhaps the locking center differential is not locking at all.

Quoted from westcoast

My mechanic suggested it likely is a fried solenoid.  Is this likely, and how complex would it be to replace the solenoid?

Do you have a service manual?  The AUTO locking function is actuated by a set of solenoids located near the top of the engine compartment, attached to the firewall.  They look like small cylinders or canisters about maybe an inch in diameter (I am not near my car so I am doing this from memory).  First, I would check to see if the wires and connections are sound.  Having a shop manual would allow you to meter out the voltages and resistances.  Only if the part fails would you need to replace it.  It is not that hard to do, just hard to find the part.  Check with ToyoDIY.com; unfortunately, they no longer have diagrams for their cars, since Toyota stupidly harassed their ISP to stop that.

Thanks for the info.  I will post on how I make out.  Recently I called a Toyota dealership regarding this problem and they said they would need to drop the entire transmission to get at the solenoids (thousands of dollars of course).  I found this quite amusing at the time.

One thing I always found counterintuitive about the automatic all-trac diff lock, is that in normal driving one should leave the transmission in AUTO mode with the light on.  Switching the light off (FREE MODE) Locks the differential.   I guess in Japan they think off is on and on is off.

The automatic transmission center locker is work when your car feel it need it... not when you think YOU need it.

I drive both manual and automatic All-trac Corolla and I can say there is a big difference between those car regarding the feeling of the center lock performance.

It is not like a 4x4 truck ! You will not feel a responce like engaging the diff locker before climbing a hill or pass a mud pit !

That is good explanation.  Assuming that I wont likely feel the diff lock in my automatic as you say, what is the best way to tell if my diff lock is working?  From what I understand, it is the change in the stiffness of the steering.  Is this true?

The best way to feel the locker with a manual trans is turning completly the steering on a dry surface and feel the tire slepering on the ground... because it is LOCK.

With my experience, I never realy feel the locker in my automatic... since, it's locker is AUTO. Honestly, you will need 30cm of snow to, maybe, realize a difference... maybe.

I used to own a mananl All-Trac for 4 years and now, a automatic All-Trac since 5 years and I can say the manual is much more better to play on soft ground because you can beat-it by playing with the RPM and with the LOCK mode, I was more confident with the all time 50%-50% power slip. The manaul trans make the Corolla a better rallye car than a automatic who made a better touring car.

Quoted from David All Trac

The manaul trans make the Corolla a better rallye car than a automatic

Ah no, now you're giving me ideas!

Quoted from westcoast

I have a 1992 Automatic Wagon.  Transmission is fine and AWD works fine.  
While the (green light) diff-lock will switch on and off, I notice no difference in steering or traction in the snow or mud.  
My mechanic suggested it likely is a fried solenoid.  Is this likely, and how complex would it be to replace the solenoid?
Thanks!  

Did you fix your problem? Just wondering.

Haven't fixed it yet.  I have been looking around for the diff-lock solenoids to see if they can be found and how much they will be.  Needless to say, you are not going to find them at Lordco.  I have phoned all my favorite autowrecking haunts and have found none at any of the lots.  This is irritating because a year ago there were a number of fine all-trac wrecks here in B.C. (which I pirated a few parts off of including a fender, entire back hatch, fuel pump and gas tank!!).  There are treasures out there waiting to be had!  

I had a chance to look into the Diff Lock problem.  I had the car on a hoist and a mechanic with time on his hands, so we mucked around a bit.  
I noticed that there is a bar/rod that connects to the passenger side Axel Shaft (there is none on the driver side).  You will have to forgive me if I use any incorrect terms.  This rod appears to push or pull? the Axel shaft, depending on which position the diff-lock button in the Car is set.  I assume this rod is moved by the solonoids we talked about before.

The rod is not seized, and works correctly.  The rod is connected to the Axel Shaft by a piece of metal with three bolts on it.  The mechanic joked that if you remove the bolt closest to the wheel, the car would become a rear-wheel drive car, with the diff-lock button functioning as a four wheel drive system like a truck!  But i digress.

There is a rectangular component down by the pedals called the "Four Wheel Drive Computer" (Denso 89533-13010)
When I remove the computer, the diff-lock light still toggles on and off.  What are the odds that replacing this component would solve my woes?  If not, the solonoids are next on the list.

For everybody's info, this computer is a discontinued part and can likely only be found at an auto wrecker.  I wonder if a standard transmission uses a different computer model than the automatic.

Any luck yet?