A two speed drive system for an all wheel drive vehicle includes a double planetary gear front differential and a power take-off unit transferring drive torque to a front wheel set and a rear wheel set of the vehicle. A rear differential connects the power take-off unit and the rear wheel set providing the drive torque to the rear wheel set. A two speed drive unit is positioned between the power take-off unit and the rear differential. The drive unit shifts between a high range drive operation and a low range drive operation. The drive unit may be mounted directly to either the power take-off unit or the rear differential.