By Matt Spetalnick

LAKEVILLE, Minnesota (Reuters) - Republican presidential nominee John McCain was booed at his own rally on Friday as he tried to rein in increasingly raw anger among supporters stunned by Democrat Barack Obama's lead in the polls.

Speaking in a Minneapolis suburb, McCain -- who had escalated character attacks on Obama in recent days -- found himself in the unlikely role of defending his rival in the face of sometimes hostile questions from frustrated Republican loyalists.

He drew boos from a crowd packed into a high school gymnasium when he insisted to a skeptical supporter that Obama was a "decent person and a person that you do not have to be scared (of) as president of the United States."

McCain appeared to be trying to dial down the ugly tone that has crept into his rallies, including anti-Obama taunts from the crowd, as his campaign has faltered amid a financial crisis that polls show most Americans believe Obama would be better able to handle.

McCain's own sharpened rhetoric, including questions about Obama's association with former 1960s radical William Ayers -- an issue he raised again Friday -- has been seen as counterproductive to attracting unaffiliated voters.

"We want to fight and I want to fight, but we will be respectful," McCain said during a question-and-answer session with voters at a campaign event in Lakeville. But when he then added, "I admire Sen. Obama and his accomplishments," the crowd jeered loudly.

"That doesn't mean you have to reduce your ferocity," he said. "It's just got to be respectful."

McCain was quick to insist that only a tiny fraction of those at his campaign events had said anything disrespectful of Obama, who would be America's first black president.

'I DON'T TRUST OBAMA'

While a number of questioners at Friday's town hall expressed concerns about Obama, one woman went further.

"I don't trust Obama. I have read about him. He's an Arab," she said, echoing a false assertion that has crept into some right-wing blogs on the Internet.

McCain shook his head in disagreement and cut her off, grabbing the microphone back. "No, ma'am. He's a decent family man, (a) citizen that I just happen to have disagreements with on fundamental issues ... He's not," he said.

Earlier, a man told McCain, "Frankly, we're scared, we're scared of an Obama presidency." He said he was especially worried that "someone who cohorts with domestic terrorists" might be in a position to choose Supreme Court justices.

"He is a decent person and a person that you do not have to be scared (of) as president of the United States," McCain responded, drawing boos and shouts of "No."

But McCain added, "If I didn't think I'd be a heck of a better president, I wouldn't be running."

Some voters also seized the chance to push McCain to get tougher with Obama at their final debate next week. Polls showed most viewers thought Obama won the last debate.

One man who said he had taken a vow to pray for McCain daily said that if Obama were elected, his grandchildren would be asking 20 to 25 years from now what happened that allowed Obama to "lead this nation to socialism."

"I got the message," McCain replied.

A McCain town hall in Wisconsin Thursday was also noticeable for its angry crowd. But a rally in the state on Friday -- before he moved on to Minnesota -- was more subdued.

The only incident was an Obama supporter shouting "Liar!" as McCain accused his rival of planning massive new taxes. McCain loyalists drowned her out chanting "U-S-A, U-S-A."

(Editing by Eric Beech)