Lindsay Lohan allegedly called the woman she hit a ''f***ing gypsy''.

The 26-year-old actress was arrested after hitting psychic Tiffany Mitchell during an argument at Avenue nightclub in New York in the early hours of Thursday morning (29.11.12) and Tiffany says Lindsay attacked her verbally and physically just because she offered her a psychic reading.

She told gossip website TMZ that she had a premonition about the troubled 'Liz & Dick' star and offered her a free reading but Lindsay declined saying 'Give me my space'.

Tiffany's friend then allegedly heard the actress call the psychic a ''f***ing gyrpsy'' and started insulting Lindsay who lashed out and hit Tiffany.

Tiffany's husband said: ''We are not Gypsies. That has nothing to do with our religion ... it was a racist comment.

''Just because your career went down the drain and your new movie sucks, you can't go around beating people up.''

Meanwhile, Dr Phil has rushed to defend Lindsay but acknowledged she should be more careful when she is out.

He told Access Hollywood: ''I mean, come on. You're in a target rich environment for trouble if you're out at 4am in a club when people get drunk. Bad things are going to happen.

''I'm actually a fan of Lindsay. I think she's very talented, she's been on my show before, she was a delightful young woman when she was there. She showed up on time, she did everything she was asked to do, she was nice to the staff and she was terrific to work with.

''I think she's got a lot going for her but is making bad decisions.''