RICHMOND, Va. —  A senator who had singled out an Indian man at a campaign event and referred to him as "Macaca" declined a leadership award from a minority scholarship fund Thursday after donors protested his selection.

Thurgood Marshall Scholarship Fund donors had threatened to withhold contributions if Sen. George Allen, a Republican seeking re-election this fall, received the fund's Community Leadership Award.

"The foundation told the senator that they've been catching a lot of static from members and some of their donors, and before it spins into a week of controversy, we just decided to decline it," Allen spokesman John Reid said.

Allen's decision came almost three weeks after he singled out a Virginia-born college student of Indian descent in a mostly white crowd at a campaign rally and twice applied the name "Macaca" to him.

Macaca is a genus of monkeys that includes macaques, and is also considered a racial slur in some parts of the world.

Allen has said he just made up a word that sounds similar to "Mohawk," a nickname Allen staffers gave S.R. Sidarth, a rival's campaign staffer, because of his partially cropped hair.

The senator said fallout from the scholarship fund award stems from political adversaries in an election year.

"I regret that there are those who would put their personal or political dislike of me ahead of the needs of deserving students and I do not want to be the cause of any controversy which could in any way harm the efforts to help these young people," Allen said in a statement.

Democrats and minority groups across the nation criticized Allen for the gaffe that some recent polls indicate has weakened his re-election campaign and threatens any plans he has for a presidential bid in 2008.

Allen apologized publicly and in a private phone call to Sidarth, 20, who was a volunteer for the campaign of Democratic Senate candidate Jim Webb. Sidarth, who had been following Allen and videotaping his campaign appearances, recorded the remarks and Webb's campaign later posted the video on the Internet.

The New York-based Thurgood Marshall Scholarship Fund is named for the civil rights lawyer who successfully argued the 1954 Brown v. Board of Education case before the U.S. Supreme Court. The ruling ended racial segregation in public schools. Marshall later became the Supreme Court's first African-American justice.