By Isabel Reynolds

TOKYO (Reuters) - Japan launched a compulsory ID system on Monday aimed at bringing government into the electronic age in the face of stiff protests calling it a violation of privacy and a temptation to hackers.

A group of academics and activists presented the Home Affairs Ministry with a petition demanding the government halt the program, which links municipal computer systems and gives each Japanese citizen an 11-digit identification number.

They filed a court case at the end of last month, demanding the system be abolished because it was unconstitutional.

"We don't want to be under government surveillance, stop the resident registry system," shouted a small band of protesters outside the ministry.

With one dressed up to look like a computer and another as Prime Minister Junichiro Koizumi, the demonstrators danced and put on a short sketch to illustrate their objections to the system.

The new database stores personal data -- names, addresses, dates of birth, gender and the new ID numbers -- for each of Japan's 126 million citizens, making it easier for them to obtain documents for a variety of public services and benefits.

But at least five municipalities, including Suginami Ward in western Tokyo, are refusing to join the system, while Mayor Hiroshi Nakada of Yokohama, Japan's second-largest city, said on Friday that residents would be allowed to choose whether to take part.

Seiji Osaka, mayor of Niseko in Hokkaido, said his town might withdraw from the system in September if personal information was not being fully protected.

About four million of Japan's 127 million people live in municipalities that are refusing to introduce the system, media said.

The mayor of Kokubunji in western Tokyo held an official "shutting down" ceremony, in which he appeared before the media and clicked a mouse to cut the local computer system off from the new network.

FEARS AND GLITCHES

Opponents fear that something sinister is at work and that the new system gives authorities a tool to harass and silence critics.

"This system treats individuals as things, not people," Hirohisa Kitano, a legal expert and professor emeritus of Nihon University, said at a news conference.

"The Nazis assigned numbers to Jewish people in exactly the same way. It is extremely dangerous," he added, explaining that he feared a return of the surveillance of citizens common under Japan's militarized system before and during World War II.

Critics say the ID number could act as a key to an array of personal data stored at different locations, making it easier for hackers to create mischief.

The government says it has created a security system that can detect suspicious access to the database.

"It's quite common to feel uneasy about something new. We want to keep explaining until such anxieties disappear," said Chief Cabinet Secretary Yasuo Fukuda.

Doubts have emerged over the technical aspects after several municipalities, including Osaka, reported computer glitches.

Mayor Kazuo Yoshimura of Yamagata City in northern Japan made what he called a "humble protest" on Monday morning, delaying the start up of the computer system in his city by one hour.

"The government was supposed to enact a law protecting personal information but failed to do so, so the mayor decided to make a 'humble protest'," a Yamagata City official said.

"But he has to respect the law," he said, explaining why Yamagata City would take part in the scheme.

Koizumi's administration failed to enact a promised personal information protection law in a parliament session ended on July 31 after protests from journalists and critics who said it would do more to muzzle the media than protect personal data.

Japanese citizens in municipalities that have not opted out will receive their 11-digit ID numbers later this month.

(Additional reporting by Masako Iijima and Masayuki Kitano)