Are the front wheels supposed to spin freely with vehicle on lift and transmission in neutral?

I’m working on a 2000 X5. Replaced the front suspension and axles. Looking to replace the front guibo as well. I have the vehicle on the lift, transmission in neutral. Front wheels are locked up. Rear wheels spin freely. Start the vehicle and put it in gear, rear wheels spin, front wheels don’t.

No known issues with transfer case.

Any help would be appreciated.

On pre x-drive when all wheels in the air you should be able to turn one front wheel by hand the opposite should turn the opposite way.

If driven by the engine the rears should turn but not the front. The TC has an "open differential" that sends ²/₃ the torque to the rear wheels so when no load just the rear will spin. DSC should hit the brakes in the rear and cause the fronts to turn if you apply power but I think at idle it might not.

Thank you for the info.

I figured out my issue; the axles I installed do not fit my vehicle.

Before 04/2000, axle hubs are 2mm smaller. I have axles built for vehicles after 04/2000. The ones I have are bumping up against hubs, instead of seating fully into the wheel bearings.

Ouch I have seen that issue in reverse (finding the matching hub for existing CV)