Originally Posted by archrival
From the info you have stated it sounds like you have a bearing out of the diff. Most likely a pinion bearing, not cheap when i checked into it last. If i were you i would contact Eurostyle and see how much for a used diff as it would be the cheaper route. Just make sure neither of your outer wheel bearings could be causing the noise you are hearing
I was thinking along the same lines. I'm going to hunt down a breakdown of our E36's differential to acquaint myself with it further.