UKIP leader Nigel Farage has defended a poster campaign claiming millions of Europeans are after British jobs as "a hard-hitting reflection of reality".
The posters - with messages including a warning British workers are "hit hard by unlimited cheap labour" - come ahead of May's European elections.
UKIP leader Nigel Farage will launch UKIP's campaign for the European and local elections later in Sheffield.
Labour MP Mike Gapes attacked the UKIP posters as "racist".
"This is a campaign designed to sow fear and animosity and hatred towards immigrants," he told BBC Radio 4's Today programme.
Mr Gapes, one of the leading backbench voices against a referendum on Britain's EU membership, claimed UKIP was following a pattern set by "far right" parties in Europe such as France's Front National and the Dutch Freedom Party. UKIP has publicly shunned both of those parties for their "extreme" views.
'Stating facts'The Labour MP was one of a number of critics to express their dismay with the UKIP campaign on social media.
Tory peer Lord Deben, after retweeting comments featuring pictures of the posters, wrote: "UKIP stands for the worst in human beings: our prejudice, selfishness, and fear."
But UKIP's deputy leader Paul Nuttall denied the campaign was racist and inflammatory, telling Today: "It's stating facts.
"The fact of the matter is we have got wage compression in this country, we have uncontrolled borders to the whole of the European Union and the only way we are going to get control of our own borders is by leaving this club."
The poster campaign, which will be backed up by newspaper and online adverts, is the party's biggest publicity drive to date.
Former Tory donor Paul Sykes is funding the £1.5m anti-EU campaign.
One of the posters asks "who runs this country", adding: "75% of our laws are now made in Brussels."
Another includes a picture of a labourer begging for money accompanied by the text "EU policy at work - British workers are hit hard by unlimited cheap labour".
UK taxpayers fund the "celebrity lifestyle" of Eurocrats, warns another.
And another poster has the text: "26 million people in Europe are looking for work - and whose job are they after?"
'Ruffle feathers'UKIP leader Nigel Farage said the posters were "a hard-hitting reflection of reality as it is experienced by millions of British people struggling to earn a living outside the Westminster bubble".
Alex Forsyth BBC political correspondent
The anti open-immigration slogans may seem targeted at the traditional right-wing, but Nigel Farage is hoping for a broader reach with this poster campaign.
It's nationwide, but many adverts have been carefully placed in Labour heartlands. UKIP thinks its anti-establishment message can appeal to both ends of the political spectrum.
In this year's Wythenshawe and Sale-East by-election they came second - gaining ground in a traditional Labour stronghold. The party wants to capitalise on this ahead of next month's European and local elections.
Mr Farage is constantly cultivating his own image as a "normal" bloke down the pub, and these posters have been deliberately designed - and placed - to persuade voters his is the party in touch with the common man.
"Are we going to ruffle a few feathers among the chattering classes? Yes," he said.
"Are we bothered about that? Not in the slightest."
Paul Sykes said in a statement that he was "supporting the biggest advertising campaign in UKIP's history to bring home to the British people what is at stake".
"The European elections are the most important for many years," he said.
He added that the other parties were "content to work within the existing Brussels straitjacket".
"An overwhelming victory for UKIP will break the political mould in the UK, forcing Labour and the Lib Dems to back a full-scale referendum and intensifying the popular pressure for that to be staged as early as general election day 2015," he said.
Editorial controlMr Sykes, one of Britain's richest self-made businessmen, has a long history of funding Eurosceptic campaigns including a £1.4m donation to UKIP ahead of the 2004 European elections.
The BBC understands he is paying for the adverts directly instead of handing the cash to UKIP, allowing him to retain some editorial and financial control.
Mr Sykes also wanted to make sure his money was used for campaigns he supported and was not used up in general party administration, BBC Political Correspondent Alex Forsyth said.
She said he had helped to design the posters and was clear they should include messages he supported.
"I view UKIP's new advertising campaign - which I am funding to the tune of £1.5 million - as more of an essential public awareness campaign," Mr Sykes told the Telegraph.
"Its real purpose is to show the British people just how many of their democratic rights and powers successive governments have quietly smuggled away to Brussels," he added.
Deputy Prime Minister Nick Clegg, meanwhile, has accused Mr Farage of being the sort of professional politician he has himself criticised and ridiculed what he said was Mr Farage's claim to be leading a movement of "insurgents" against the EU and the other UK parties..
"Of all Nigel Farage's far-fetched claims - and there are many - the most outlandish is the idea that UKIP's call for an exit is the insurgents' battle cry," the Lib Dem leader wrote in the Guardian.
"He and I were elected to the European Parliament on the same day in 1999. I left after five years. The UKIP leader is still there."
And he criticised UKIP as "simply the fresh face of a long-standing Eurosceptic establishment, supported by many in the Tory party and significant parts of the press".
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