A spline clutch maneuvered by an actuator provides a Power Transfer Unit (PTU), the functions of power disconnection, or speed selection. In the driveline system, the PTU actuator is the core mechatronic component to realize the essential functionality. This paper focuses on increasing the performance and stability of the PTU using analytical mechatronic modeling and analysis with ADAMS-Simulink co-simulation. By utilizing the Adams, the PTU was modeled, and the characteristics of the sleeve walk-out were revealed. The motor and partial mechanical components were modeled in the Simulink and combined with the Adams model for co-simulation. The fuzzy logic with PID position control is developed to suppress the on-set of the walk-out. The effectiveness of the control strategy was validated by the co-simulation. This method can be extended to other actuators with spline clutch applications to minimize the risk of walk-out.