* Turkey's first openly Kurdish presidential hopeful
* Demirtas seeks to expand base to become national figure
* Trailing in third place in Sunday's vote
By Ayla Jean Yackley
ISTANBUL, Aug 9 (Reuters) - Unthinkable just a few years ago, Selahattin Demirtas' bid for Turkey's highest office underscores how Kurdish politics has entered the mainstream even as Kurds in neighbouring Syria and Iraq push for more automony.
Peace talks between Turkey and Kurdish rebels, overseen by Prime Minister Tayyip Erdogan to try to end a three-decade war, have brought two years of calm and paved the way for Demirtas to run as Turkey's first openly Kurdish presidential candidate.
"My candidacy is merely the most visible aspect of how much Turkey has changed as racism and extreme nationalist sentiment weaken," Demirtas, 41, said in an interview.
Though other Kurds have figured prominently in Turkish political history, some supporters liken his candidacy to Barack Obama's run to become the first African-American U.S. president.
A big difference is that Demirtas is unlikely to win.
Erdogan, a devout conservative credited with overseeing a tripling of Turks' wealth over the past decade, is the clear front runner to become Turkey's first popularly elected president in Sunday's election.
Two surveys last month put his support at upwards of 55 percent, despite a corruption scandal earlier this year, anti-government protests last summer and charges that he has polarised society along secular and religious lines.
Main opposition candidate Ekmeleddin Ihsanoglu was 20 points behind, with Demirtas in a distant third with under 10 percent.
Demirtas' candidacy burnishes Erdogan's credentials as peacemaker after he took a considerable political risk to begin talks with Abdullah Ocalan, the jailed leader of the armed Kurdistan Workers Party (PKK) who in 1984 launched the uprising that has claimed more than 40,000 lives.
Erdogan attracts about half the votes of Kurds, who make up a fifth of Turkey's 76 million people. But Demirtas rejects the idea that his candidacy is Erdogan's "gift to Kurds".
"Turkey is changing but this is due to our efforts. If it were up to Tayyip Erdogan, he would have blocked my candidacy."
Ihsanoglu's supporters say Demirtas is dividing the opposition, helping deliver victory to Erdogan, who, for his part, accuses Demirtas of stoking Kurdish nationalist passions.
As U.S. officials look to Kurds in Iraq, who want independence, to check Islamist militants, Kurds like Demirtas see their future within Turkey.
NEW KURDISH IMAGE
"Kurds and American blacks have had to fight racism," Demirtas said of comparisons with Obama. "Our candidacies are important in the fight to make equality more of a reality."
Witty and with a toothy grin, Demirtas' handsome image appears widely with his schoolteacher wife and two daughters, adjusting the image of Kurdish politicians among Turks with long memories of PKK violence.
The United States, Turkey and the EU list the PKK as a terror group, and most precursors to Demirtas' People's Democracy Party (HDP) have been outlawed for PKK links.
"That we have an outwardly Kurdish candidate from a Kurdish nationalist party is an incredible change," said Aliza Marcus, author of "Blood and Belief," a book about the PKK.
"His campaign allows Turks to see Kurds in a different light ... beyond the image of terrorists."
Thousands of Kurdish politicians and activists spent up to five years in jail without conviction until most were released this year under a law linked to the peace process.
In 1994, four Kurdish lawmakers were jailed for a decade after taking the oath of office in Kurdish, a language banned outright until 1991.
Called "Mountain Turks," Kurds' ethnicity was denied. Politicians in the 1980s claimed the name came from "kart kurt," the crunching sound made while treading in snow.
Demirtas' parents spoke Turkish and not their native Zaza dialect with their seven children. "They tried to assimilate us because they knew the burden of being Kurdish," he said.
He was largely unaware of the Kurdish identity until he attended the 1991 funeral of a prominent politician believed murdered by security forces in Diyarbakir, the biggest Kurdish city. Eight people died when gunmen opened fire on mourners.
"That event ... was the catalyst for me to begin questioning politics," said Demirtas, who became a human-rights activist.
When violence between the PKK and security forces peaked in the 1990s, Demirtas briefly contemplated joining the group.
"Every Kurdish youth thought of it then," he said. "But I chose to study at university and become a human rights lawyer."
Demirtas seeks to expand his base beyond the Kurdish vote. His party has brought to parliament Turkey's first Christian MP in 50 years and he champions broader rights for gays.
His aim, senior party officials say, is to achieve at least 10 percent, the level his party would need to enter parliament in next year's general election.
But for most Turks, Demirtas is seen as too close to figures like Ocalan to ever be a palatable candidate, said Dogu Ergil, political science professor at Fatih University.
At a rally last weekend in Istanbul, Demirtas drew mainly Kurdish crowds. Turkish union members, environmentalists and leftists came in smaller numbers.
As Demirtas addressed the crowd, youths with masked faces waved large banners with Ocalan's smiling face, an image not often seen outside of the mainly Kurdish southeast.
"I feel very emotional about being in this square with our flags flying," said Haydar, 55, a garbage man who didn't give his surname. "I always hid that I was Kurdish. Now I feel pride." (Editing by Nick Tattersall and Ruth Pitchford)