This might help. Unlock the door with your key, open it,shut it and lock with your key. Wait 20 seconds and unlock the door with your key. My alarm system shut down my ignition one day making it so that I couldn't start the car. My friend a radio tech told me this and it worked.
The late-90's GM Passlock system (e.g. 1997 Malibu, Regal, Impala, etc.) has a part around the ignition tumbler that goes bad and no longer reliably detects the valid key. In that situation, the "Theft System" light will slowly flash and the carburetor is cut off so the engine won't start. The time-out on the system is 10 minutes - you don't have to do anything, you don't have to disconnect the battery, the key can be out of the ignition -- it's just a time delay. After 10 minutes, the light goes out and you can try again (but if the key is again not detected, the light will start flashing again and you have to wait another 10 minutes).
I would just like to add a little something to this answer. I have a 97 Malibu. I have had my anti-theft system go off many times due to the tumblers in the ignition being bad. When the theft system goes off " the light blinks" you can wait 15 minutes and it goes off by itself. A word of advice if it keeps doing it you probably need a new ignition.
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This might help. Unlock the door with your key, turn the ignition on, let it stay on for 10 to 11 minutes, turn the ignition off, take out the key from ignition, after one minute start the car. Car will start. It worked for me.
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I had this same problem. I simply disconnected the battery for 15 minutes. When I reconnected it, the Theft System light was gone. I still have the problem once about every 4 months, so I just keep repeating the process.
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I have had this problem for almost a year. The last time, the theft system deactivated my car three times in a row (had to wait a total of 30 mins for it to start) Usually I have the problem once every week or two. I have tried unlocking and relocking the door, I had a new key cut and that worked for a while. My mechanic wanted $500 to replace the ignition. A friend of mine has a Malibou he had the ignition replaced and a year later has the same problem.
Someone else, who had this problem, told me to remove all other keys from my keyring. The weight of the other keys pulls on the ignition key causing the key to be unreadable. It has been 7 weeks since I have been doing this and have not had a problem.
Hope this helps!!