I have recently acquired a 1997 Jeep Grand Cherokee Laredo, as I've wanted for awhile. As with any pre-owned vehicle, it has its quarks. Biggest, most confusing question is why does the speedometer bounce up to 120 and stay there when I'm only doing 60-65 on the highway? On side streets, there's no telling how fast I'm going. All I know is that I'm doing somewhere between 10 and 70 mph. It [the speedometer] is all over the place. Is this an easy fix to get my speedometer to read correctly? Please shoot me a suggestion because the dealer sure as h#$# didn't know.
PS. Yes, it's an analog speedo..not digital.
Thank you.

The first thing I would check is the wirring around the Speed Sensor back to the Inst. pannel. Then the Sensor Itself. Does the Check engine light come on while the spedo is acting up?

(cam7) thank you for the advise. I haven't had a chance to check it yet, but hopefully it is a problem within the wire. I heard the '02 Liberty has the same problem caused by the speedo wire shorting against the parking break cable.
My check engine light does not come on, however the speedo only does this every now and than. Once it's been driven for about a half an hour, the problem seems to correct itself or at least improve.

How can you access the back of the instrument panel to check the wiring around the Speed Sensor?

I have recently acquired a 1997 Jeep Grand Cherokee Laredo, as I've wanted for awhile. As with any pre-owned vehicle, it has its quarks. Biggest, most confusing question is why does the speedometer bounce up to 120 and stay there when I'm only doing 60-65 on the highway? On side streets, there's no telling how fast I'm going. All I know is that I'm doing somewhere between 10 and 70 mph. It [the speedometer] is all over the place. Is this an easy fix to get my speedometer to read correctly? Please shoot me a suggestion because the dealer sure as h#$# didn't know.
PS. Yes, it's an analog speedo..not digital.
Thank you.There is a speed sensor located on the top center very back of the transfer case / transmission next to the drive shaft. Easy to get to and replace although you say it is analog which makes me think you have that old style cable running from transmission to the speedometer and if so all you do is greese the cable which it will fix problem.

It is analog—so I'll have to look for that cable.