'96 Cherokee Sport Temp Control Issues

So I'm going through raiator fluid faster then gas. The temp gauge never shows it over-heating, but will go lower then normal from time to time.

I figure it could be the following but would like help narrowing it down before I throw money at it;

Radiator - replaced ~a year ago.
Radiator Cap
Water Pump - Not leaking
Thermostat
Loose Belt - Seems tight

I have yet to change the oil in it to see if there is radiator fluid but plan to in the next few days. What I'm stumped on is why it's not overheating. What usually happens when the thermostat sticks open?

If this is a 4.0 I doubt a head gasket, could be but doubtfull. Before going any further I would pressure test the system and see if there are any external leaks, possibly a freeze plug or heater core. Upper hose on these engines leak often right at the thermostate housing. I have seen these engines when the coolant is very low not show overheating because the sensor is no longer bathed in coolant show cooler than what it actually is.

If you have the 0331 head, there was a manufacturing defect that allowed tiny cracks to develop. On my '01 this happened, and it ran perfectly but I had coolant in the oil.

If this is your situation, the best option is to replace the head.

First thing to do is change your oil and have it tested for coolant. I use Blackstone Labs.

hey i had the same thing happen with my 01 xj and it turned out to be the heater core. I did change the thermostat also but it was definitely the heater core. I know that if you have a fail safe thermostat they will fail in the open position that would cause the engine temp to stay cool. but the fact that you are losing fulid leads me to believe that your core has a hole in it.

good luck