Voters on Sunday chose a national assembly that will retool Bolivia's constitution, a crucial test for leftist President Evo Morales as he seeks to empower the country's Indian majority and exert greater state control over the economy.

Voters will also decide whether Bolivia's nine states should have more fiscal and political autonomy — an issue that has exacerbated long-standing tensions between the country's more wealthy eastern lowlands and the poorer, less fertile Andean highlands.

The main opposition party is making Morales' close relationship with Venezuelan President Hugo Chavez the central issue, accusing Chavez of orchestrating Morales' campaign to remake the constitution in South America's poorest country.

Bolivians will elect 255 delegates to the assembly, which will begin work Aug. 6 and take up to a year to rewrite the constitution. Two-thirds of the body must approve the changes, which then must be endorsed in a nationwide referendum.

No polls have been conducted, but Morales' Movement Toward Socialism party, or MAS, was favored to win a majority in assembly.

Shortly after voting in Chapare, Morales said he wanted Bolivian's constitutional overhaul to serve as an example for the world.

"The discriminators, the exploiters, the marginalizers, the haters toward the peasant movements have to be stopped as well as inequality and injustice," he said. "Once there's a new constitution, we'll implement a gradual and democratic process of peaceful change."

FOXNews CountryWatch: Bolivia

Hundreds of election observers fanned out across the country Sunday and monitors told The Associated Press that voting was peaceful.

Morales won the presidency in December by a historically wide margin and remains hugely popular, though his relations with the United States have chilled due to his forging of closer ties to Venezuela and Cuba.

While Morales' government has used decrees to advance some of its goals, such as nationalizing natural gas production, it wants the constitution to enshrine its accelerated transfer of state-owned land to peasants.

Perhaps the most divisive issue Sunday is a separate ballot question asking if voters favor shifting many executive and financial powers to the states from the central government.

Santa Cruz, Bolivia's wealthiest and largest state in the country's eastern lowlands, is spearheading the "yes" campaign. It's also the center of opposition to Morales, who has said he'll vote "no," claiming autonomy will only benefit the country's "oligarchs."

The government alleged Sunday that some voters in two states, Pando and Beni, were being offered food, clothes, cable television and even solar panels in order to vote "yes" on autonomy and asked election authorities to investigate.

The main opposition party, Podemos, favors switching Bolivia to a parliamentary system, weakening the presidency in a country that has seen 189 coups since its 1825 independence. Podemos would also introduce direct elections for more political offices and increase prison terms for violent criminals.

Critics claim that Morales will use the assembly to increase his power like Venezuela's Chavez, who held a constituent assembly in 1999 that concentrated executive power and hastened his re-election.

Many in MAS support changes that would allow Morales to run for another five-year term. Current law bans him from running for re-election in 2010.