I'd always thought that the booing was in reaction to Dylan "going electric" and scandalizing the audience at the festival, but reading more about it the reports actually seem conflicting. Do we know of a prevailing reason for the booing, or are the reasons truly unknown?
This is one of those legendary events where everyone who was there has a different account of how it went down. Some important details usually in the story are
Dylan playing electric was a shock to the folkie audience. Maybe, but this was not the first time electric instrument had graced the Newport Folk Festival stage. The Chambers Brothers played earlier the same day with an electric band, as had the Butterfield Blues Band, a few of whose members were actually the group backing Dylan.
Dylan is introduced, and booed as he gets on the stage. This has been attributed to him appearing with an electric guitar, but has also been explained as a reaction to the introduction itself, which explained that Dylan had a "limited amount of time." As Dylan was one of the biggest names at the festival, it'd be only natural for the crowd to be disappointed to learn that he wasn't going to do a long set, which could explain the booing.
The sound was bad. This was an issue with the festival and many outdoor venues in general (eg Woodstock a few years later), but having an electric band adds a greater degree of complexity and therefore many accounts state that his set was nearly indecipherable. This again fuels disappointment in the crowd, and also will affect one of the biggest legends to come out of the "Dylan goes electric" myth.
Pete Seeger threatens Dylan with an axe! The juiciest and most widely-varied rumour out there. In some versions, Pete has an axe and has to be restrained from either attacking Dylan or cutting the cables to the sound equipment. Others just have him threatening to do that, with no axe actually in sight. One of Seeger's friends even suggests that all he wanted was for the sound to be turned down, on account of his father's hearing. Whatever the issue, Pete's disgruntlement is seen as the prime example of the folk "establishment" rejecting Dylan. Pete, for his part, said that he did bring up cutting the cables with an axe, but only because the vocals were so distorted that Dylan's lyrics were unrecognizable, and said his words were:
Get that distortion out of his voice, it's terrible. If I had an axe, I'd chop the microphone cable right now.
Dylan's set ends, booing ensues, but he returns with an acoustic guitar to cheers. This is sometimes portrayed as him "giving them what they want," an acoustic, more traditional folk performance. However, some people there, including members of Dylan's band (as we'll see below) contend that people were just upset that Dylan was seemingly being hurried off stage by organizers keen to keep a tight schedule. Since the band had just rehearsed a few songs, he was convinced to come back out and do something solo as a sort of encore, which the crowd appreciated.
News spreads of the booing. This is one of the most important aspects of the mythmaking process. The New York Times, writing a review of the concert, said that Dylan "was roundly booed by folk-song purists who considered this innovation the worst sort of heresy." To anyone who wasn't there, this was an account in a reputable paper stating a fact, and since it played on popular stereotypes of the snobbish folkie vs the rebel rock n roller, it ended up becoming a fact for many.
Al Kooper, who was in Dylan's band, has blamed the shortening of the set for the booing issues, as he says in this interview:
Newport was, and Forest Hills was one of the biggest circuses I've ever been in. At Newport there were a lot of warring factions. The Lomaxes and the Grossmans were at war over the fact that there were electric instruments at Newport. In fact, way before Bob played, the Butterfield Band had played electric, and the Chambers Brothers had played electric. And, and the board of directors were going berserk. They didn't like it. This was really not known by the crowd that was there. The crowd that was there certainly took it all in and enjoyed it and didn't boo the Butterfield Band or the Chambers Brothers or anything like that. Now, most of these people had come to see Bob Dylan. He was the star of the festival and he played on the last night, at the highlight of the show.
And all these other acts were pretty much something that these primarily college kids had to endure as opposed to appreciate. They didn't care about the Georgia Sea Island Singers or Son House or Robert Pete Williams or any of the other things that were on there. They wanted to see their hero, Bob Dylan play, and that's what they plunked down the money for. And they came sort of like a spring break mentality. And of course there were people to see the other things, but I'm talking about by and large the majority of the people that were there were there with a spring break mentality to see their hero Bob Dylan. So the Georgia Sea Island Singers, Son House and Robert Pete Williams came out, and they all played like 45 minutes to an hour shows.
And then, uh, I played at Bob at Newport with uh, the Butterfield Band backing him up. And we rehearsed the night before all night in some mansion in Newport. And we rehearsed three songs. So Bob came out with this electric band and played three songs. And we didn't especially play that good. It wasn't that good. And so all these people who had endured this whole weekend, and Bob Dylan comes out and plays 15 minutes after Son House plays 45 minutes. Well, they went nuts. Not 'cause he played electric. But because they'd paid all this money and spent all this time and suffered all this other musics, and heard 15 minutes of Bob Dylan, and they went nuts. I don't know that they really booed. I didn't hear any booing. But they certainly were unhappy, and they were yelling more, more, more, more.
And I was backstage, and Peter Yarrow, who was the MC, from Peter, Paul and Mary, came over to Dylan and said, you gotta do another one. Bob said, we don't know any others. And Peter said, well, for godsakes go out there with your guitar and just play one. Cool them out, they're going nuts. I think Peter understood the severity of the situation. Whereas we didn't really understand it, you know, what was happening, other than they wanted to get as much Dylan as they could get, but didn't understand the dichotomy of the 15 minutes versus the 45 and an hour. So Bob went out with an acoustic guitar and played "It's All Over Now, Baby Blue". Which was great drama. And it was cracking me up. And uh, it was. It was all over now, baby blue. Now, then we played Forest Hills a few months later. And what had transpired is that at this time now, "Like A Rolling Stone" is number one in the country. And all the journalists have written about how the audience booed Dylan at Newport for playing electric, which was a crock.
So, the answer is that, short of polling every single person who booed at the festival, we don't know the exact reason why they booed. But it was most likely a combination of factors, and in fact could have been because people wanted more Dylan, not because of their disapproval of his music.