Presley's first single was recently re-released in the UK

The 2004 event in June recorded a loss of $5,465 (�3,033), having lost $2,642 (�1,466) the previous year.

The Tupelo Convention and Visitors Bureau had halved its usual financial contribution to the festival to $50,000 (�27,700) in 2004.

"It is a serious situation," said festival chairman Gary Bailey.

"We have to do whatever we can to make it successful next year," he added.

The festival has attracted some big name performers in the past, including Little Richard and BB King.

Historic occasion

The Supremes, featuring Mary Wilson, headlined this year's event.

"We love festivals," said Linda Butler Johnson, executive director of the Tupelo Convention and Visitors Bureau.

"And we love to help with seed money, but over a period of time we need to pull back and let them stand on their own feet," she said.

Tupelo is proud of its most famous son, who was born there on 8 January, 1935, marketing itself as the birthplace of Elvis Presley.

The house where he was born has been turned into a museum, and is a shrine to his legion of fans who can actually walk around the room where his mother gave birth to him.