Hi all,
I have this problem and after searching many forums and this one I realize I pretty much have the opposite of the 'normal' headlight problem.
The normal problem I read about headlights Is they lights go on but the headlights don't pop up

My problem:
When turning on my headlights, position 1, everything works fine.

Position 2 (headlights) don't come on but the headlights pop up, also the high beams don't work and the high beam indicator on the dash does not illuminate.

when I try to turn the high beams on with the headlight switch off the headlights don't pop up nor does the high beam indicator illuminate.

after reading different forums it's looking like the headlight retracting problem could either be caused by a bad headlight switch or more likely a bad turn signal assembly, which could be fixed by opening it up and soldering the connectors but before I buy replacement parts or open up the assembly I want to know if Anyone else had a problem similar to mine where the lights go up and down but not on? and how they solved it, also why would a bad turn signal assembly keep the headlights from turning on? I know toyota has a retarded backwards ass headlight system where the wire is always hot and the switch supplies ground to turn on the lights or some **** like that, that no one can figure out -_-

also couldn't really diagnose the cars electrical system fully, because its been raining non stop the last few days and this problem just started yesterday, headlights was working fine then all of a sudden it stopped.

So new development with the headlight problem.
I went out to check the lights since its not raining; again headlights both low and high beams were not coming on neither was the highbeam indicator on the dash.
So I got my multimeter:
- unplugged the drivers side headlight to check if it was getting power while the headlight switch was on; it was not.
- I check to see if it was getting power while the high beams where on; it was not.
I looked over and noticed that my passenger headlight low beam was working, so I tried the high beams it was working as well and the indicator on the dash was working too.
I turned off the lights and plugged the driver headlight clip back in and tried turning the lights on and everything worked fine.

The weird thing is I never touched any fuses or relays because I checked the fuses last night; all I did was unplug and test the volts going to the headlights.
So with all things considered I'm going to assume my headlight switch is most likely the culprit; but just to be sure I'm going to make sure all my wiring to my drivers kick panel is plugged in all the way, because last week I took out that fuse panel to clean the terminals because my 15A TAIL fuse was corroded causing my dash lights to not illuminate.

Sometimes the wiring or contacts in a plug are corroded and simply replugging them cleans them enough to work, at least for a while. You can check out the turn signal switch and headlight switch by unplugging them and using the multimeter although you'll need a wiring diagram to get the pinouts right. Since Toyota never did a troubleshooting tree for the headlights, it is nearly impossible to figure out all the reasons they can fail and testing bits and pieces is often the only way to go.

Red wrote:Sometimes the wiring or contacts in a plug are corroded and simply replugging them cleans them enough to work, at least for a while. You can check out the turn signal switch and headlight switch by unplugging them and using the multimeter although you'll need a wiring diagram to get the pinouts right. Since Toyota never did a troubleshooting tree for the headlights, it is nearly impossible to figure out all the reasons they can fail and testing bits and pieces is often the only way to go.

It's funny you brought that up corroded contacts because the problem turned out to be just that; there was corrosion on the harness that plugs into the headlight switch so I cleaned it up and put some dielectric grease on it and its working fine. Thats the main draw back of living right next to the beach is all the salt air corrodes everything fast -_-