I just wanted to know where the thermostat is located on the 1996 volvo 850?

 

Welcome.

It is inside the thermostat housing


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That is it - spot on. If your are planning to change it get the "New Style" bolts, they cost under $1.00 each even at the thieves at my nearest dealership.Be very deliberate when taking out the old bolts if they are the old style aluminum bolts. A shot of PB Blaster overnight helps and I "wake up the bolts" by giving them a smack with a hammer on the end of the extension before I try to remove them.

Replace the ECT sensor while you are in the neighborhood.

...Lee