Abstract: A vehicle differential unit including adjustable bearing assemblies has a differential carrier adapted to support a differential case assembly including differential case bearings associated therewith The differential case bearing assemblies rotatably support the differential case assembly within the carrier of the differential unit. Adjusting rings are provided and supported internally in a pair of axle tubes associated with the differential carrier. The adjusting rings are selectively biased against the bearing assemblies to impart the desired bearing preload and backlash within the differential unit. The adjusting rings replace the use of adjustment shims, and are accessible to permit adjustment if necessary without the need to remove the differential case assembly. The adjusting rings are threadably supported within the axle tubes to provide a rigid construction which simplifies constuction and adjustment of the differential unit.