VENTERSDORP, South Africa (Reuters) - The party of murdered South African white supremacist Eugene Terre'blanche has said it will not take violent action to avenge the death of its leader after his brutal killing on Saturday sparked fears of racial unrest.

Terre'blanche, who led the Afrikaner Resistance Movement that pushed to preserve apartheid in the 1990s, was hacked and battered to death by two black farm workers in a suspected dispute over pay.

Leaders of his party, which has been marginalised in recent years, initially vowed to avenge his death, blaming it on sentiment whipped up by the leader of the youth league of the ruling African National Congress.

But a spokesman for Terre'blanche's AWB told reporters on Monday that the party was not planning violent action.

"The AWB is not going to engage in any form of violent retaliation to avenge Mr Terre'Blanche's death," Pieter Steyn, a general in the AWB, said. "We appeal for people to remain calm. Anyone engaging in any form of violence is not doing it as AWB."

South African leaders, including President Jacob Zuma, have also urged calm since the killing. The so-called "Rainbow Nation", already saddled with a reputation for crime and violence, will be in the international spotlight in a little over two months when it hosts the soccer World Cup.

Whatever the motive for the killing, it has exposed the deep racial divide that still exists in the country 16 years after the end of apartheid.

Opponents of the ANC accuse its youth leader Julius Malema of stoking that through rhetoric and his singing of an apartheid-era song containing the words "Kill the Boer" -- now banned by the courts as hate speech.

Malema was in Zimbabwe over the weekend, where he praised President Robert Mugabe's seizures of land from white farmers to give to landless blacks -- a policy critics say has helped ruin Zimbabwe.

MOURNERS LAY FLOWERS

Terre'blanche had lived in relative obscurity since his release from prison in 2004 after serving a sentence for beating a black man nearly to death.

His sympathisers drove from around South Africa on Monday to lay flowers at the gate of his farm in Ventersdorp, over 100 km (60 miles) west of Johannesburg.

Evidently angry, many of the mourners would not speak to reporters. One brought a large white teddy bear. Police kept watch from cars to prevent any trouble.

"Emotions are running very high at the moment," said Andre Nienaber, a relative of Terre'blanche.

Potential flashpoints this week include the court appearance on Tuesday of the two men accused of the killing, and Terre'blanche's burial on Friday.

The AWB, whose flag resembles a Nazi swastika, has a tiny following among whites, who make up 10 percent of South Africa's population. Afrikaner groups say anger in white agricultural communities has been growing because of a series of farm murders.

"Unfortunately if the government is not seen to do something very serious and effective now, people are going to take the law into their own hands," Dan Roodt of the Pro-Afrikaans Action Group told South Africa's etv.