The RAdial Velocity Experiment (RAVE) is a medium resolution R~7500 spectroscopic survey of the Milky Way which already obtained over half a million stellar spectra. They present a randomly selected magnitude-limited sample, so it is important to use a reliable and automated classification scheme which identifies normal single stars and discovers different types of peculiar stars. To this end we present a morphological classification of 350,000 RAVE survey stellar spectra using locally linear embedding, a dimensionality reduction method which enables representing the complex spectral morphology in a low dimensional projected space while still preserving the properties of the local neighborhoods of spectra. We find that the majority of all spectra in the database ~90-95% belong to normal single stars, but there is also a significant population of several types of peculiars. Among them the most populated groups are those of various types of spectroscopic binary and chromospherically active stars. Both of them include several thousands of spectra. Particularly the latter group offers significant further investigation opportunities since activity of stars is a known proxy of stellar ages. Applying the same classification procedure to the sample of normal single stars alone shows that the shape of the projected manifold in two dimensional space correlates with stellar temperature, surface gravity and metallicity.