How to Reset the ABS Light on a BMW E36

1. Drive the vehicle onto a flat surface and shift the transmission into "Park" or first gear (manual transmission). Turn off the engine and apply the parking brake. Turn the ignition back to the “On” position so the dashboard has power.
2. Locate the vehicle’s diagnostic data port. This port is located underneath the dashboard, just above the pedal area. It is approximately 2 inches wide, a half-inch tall and made from black plastic.
3. Connect the scan tool’s data cable to the diagnostic data port. Power on the scan tool and choose “ABS” from the scan tool’s main menu.
4. Choose “Trouble Codes” from the ABS menu. Select “Clear All Current and Stored Trouble Codes” from the Trouble Codes menu. Wait a moment while the scan tool clears the trouble codes.
5. Turn off the scan tool, unplug it from the vehicle and start the engine. Confirm that the ABS light is no longer on.