Former Alaska Gov. Sarah Palin (R) defended her endorsement of anti-establishment Kentucky Senate candidate Rand Paul, saying that she agrees with his domestic agenda "for the most part."

Paul is running in a primary against Kentucky Secretary of State Trey Grayson, who is backed by GOP establishment figures such as Senate Minority Leader Mitch McConnell (Ky.)

Asked by "Fox News Sunday" host Chris Wallace why she endorsed Paul, Palin said “Because he's a federalist and he wants the states to have more say and as we respect the 10th Amendment in our Constitution, he wants the states to have more say in a lot of these issues."

Palin's endorsement of Paul is one example of the tension between the conservative grass-roots and the Republican Party establishment, which have clashed on the best way to defeat Democrats. The former governor has brushed off the notion of tension within the party, saying that competitive primaries are good for the GOP.

Rand Paul is the son of libertarian Republican Rep. Ron Paul, who is a favorite of the Tea Party movement but is out of step with the majority of his party in Congress.

Even though the younger Paul supports some of the policies his father does that are not favored by other Republicans, Palin said he is still a better choice than Grayson.

"But nobody is ever going to find a perfect candidate," she added. "There are things that I don't agree with Rand Paul, and yet his domestic policies for the most part, I do agree with."