The Greek Neo-Nazi party Golden Dawn is softening its image and tempering its rhetoric before Sunday's European elections. Replacing boots with suits, the party has sought to shed its menacing persona, fielding middle-class professionals in an effort to broaden its appeal. Among its 42 candidates are university professors, lawyers, surgeons, business people and a former Nato commander.

"Golden Dawn is in a new phase of development due to Greece's social and economic crisis," said Giorgos Kyrtsos, a political commentator and European parliament candidate for the ruling centre-right New Democracy. "With the middle class determined to avenge the government for policies that have seen its living standards collapse, the far right has understood strong-arm tactics are no longer necessary."

The makeover offers an image far removed from the black-shirted assault squads that have come to be associated with a party accused by the authorities of being a criminal organisation.

A number of the movement's leaders, including its founder, Nikos Michaloliakos, have spent eight months in prison pending trial. Many had thought the crackdown, spurred by the murder of an anti-fascist rapper, would be the demise of a group that five years ago took just 0.2% of the vote. But efforts at cleaning up the party appear to have paid off. As in Hungary, where the neo-fascist Jobbik party increased its share of the vote in parliamentary elections last month by projecting itself as more moderate, the new-look Golden Dawn got its first endorsement in local elections last weekend.

Despite facing government accusations of involvement in murder, extortion and racist violence – and the discovery of portraits of Hitler and Nazi paraphernalia in the homes of Michaloliakos and other MPs – the ultra-nationalists clawed back support with a surprisingly strong performance.

In Athens, the area worst hit by record unemployment and six straight years of recession, Ilias Kasidiaris, Golden Dawn's mayoral candidate, won 16.1% of the vote – more than double the party's showing in general elections in June 2012. Although the former commanderarmy commando, whose left shoulder bears a large swastika tattoo, failed to make it into Sunday's runoff, his success was echoed in working-class suburbs, where the party polled more than 20%.

"Golden Dawn is the only political force in the country that is rising," said Kasidiaris, whose personal ratings soared after he assaulted two leftwing female MPs during a televised debate two years ago. "Greeks recognised that we have become their voice, the voice of truth, in the corrupt parliament."

But it is the far-right party's growing appeal to what was once the country's well-heeled bourgeoisie that has most surprised analysts.

In Kolonaki, an upmarket Athens district of high-end boutiques, where women walk toy dogs and young, designer-clad men spill out of cafes and bars, the extremists attracted 13.7% of the vote. Along its high street, the talk this week was almost exclusively of Golden Dawn – and how it had succeeded in inveigling its way into the homes of local people. Had it found fertile ground only in Greece's economic crisis, or was its ideology of hate – for immigrants, gay people and Jews – the draw for voters?

Entrepreneur Dimitris Deliyannis, who plans to vote for the group, thought it was a bit of both. The recent arrival in Kolonaki of beggars, homeless people and foreigners selling flowers had eroded people's sense of security, he said. "It's a protest vote. We're not fascists or Nazis, but this is a system that is totally rotten, totally corrupt, that stops you in your tracks and lets immigrants get away with murder," he said. "And because we know the system hates Golden Dawn and has used everything at its disposal to eradicate Golden Dawn we are going to hit the system with it."

Yannis Kollides, a legal adviser at a government ministry, agreed. Like his friend he is, at 50, old enough to remember the return of democracy to Greece in 1974, but too young to recall the preceding seven-year dictatorship. "What I feel is rage and Golden Dawn is the answer to it," he said. "And look, they're nice guys now. If they get into the European parliament they can help change the policies of austerity and all the submission, exploitation and globalisation that has got us in this mess."

Human rights groups are alarmed at Golden Dawn's rise. The far right's ability, Europe-wide, to move into the political mainstream on a platform of hate has raised fears of alliances being formed that will ultimately undermine democratic norms from within.

"It is just as dangerous when parties like Golden Dawn and Jobbik try to sanitise themselves to attract votes," said Sonni Efron of Human Rights First, who is visiting Greece as part of a team. "It enables voters who are most angry about economic problems and want to cast a protest vote, or punish those in power, to pretend that these parties are not really fascist," she said.

For seasoned Golden Dawn watchers, the party's transformation is no surprise. In 2007, Michaloliakos, an open admirer of the military junta that once ruled Greece, wrote in the party magazine: "We will appear as the good guys. We will use the political system but our goal will be to use it as a Trojan horse to conquer the system … just as Odysseus did when he massacred the Trojans."