Taking a stand at odds with the man she'll probably run against next year, the first lady said today she doesn't personally approve of a museum's controversial exhibit but thinks it's wrong to take city funds away from the institution.

Speaking outside a Harlem school this morning, Hillary Rodham Clinton said she doesn't like the idea of a portrait of the Virgin Mary embellished with elephant dung, part of an upcoming exhibit at the Brooklyn Museum, but she believes the museum has a right to show it.

Mayor Rudolph Giuliani, who, like Clinton, is considering running for U.S. Senate, is pledging to cut $7 million in city funds if the museum goes ahead with the show, "Sensation: Young British Artists From the Saatchi Collection," set to open Saturday.

"I share the feeling that I know many New Yorkers have that there are parts of this exhibit that would be deeply offensive," Clinton said. "I would not go to see this exhibit." But she said, "it is not appropriate to penalize and punish an institution such as the Brooklyn Museum."

On Sunday, Cardinal John O'Connor sided with the Republican mayor, while civil rights activists said that pulling the museum's funding would violate the First Amendment.

"I'm saddened by what appears to be an attack not only on our blessed mother . . . but one must ask if it is not an attack on religion itself and in a special way on the Catholic Church," O'Connor said in his weekly sermon at St. Patrick's Cathedral.

O'Connor did not name Giuliani, but he said he was grateful to city officials, adding: "It is their right, if not their duty, to express themselves on such matters."

He urged his listeners to send protest letters to the museum. But New York Civil Liberties Union Director Norman Siegel said the threat to cut funding violates the First Amendment.

"His assertion that New York City can withdraw all funds for the museum based on a single exhibition that he finds offensive illustrates a serious misunderstanding of the Constitution," Siegel said.

The museum's director, Arnold Lehman, has not publicly said what he will do, but he has a reputation for standing firm on matters of artistic expression. Directors of other museums have been noticeably silent.