We present observations and model calculations of the modulated intensities of galactic cosmic ray protons above 106 MeV/n along the Ulysses trajectory. Data are taken by the Cosmic and Solar Particle Investigation (COSPIN) Kiel Electron Telescope (KET) from spring 1993 to fall 1996. During this time period solar activity decreased and galactic cosmic rays recovered. To separate spatial from temporal variations we used the University of Chicago measurements from IMP 8 near Earth and compare the residual spatial variation with time independent modulation models. According to standard drift dominated modulation model, one would expect a radial gradient of ≈2%/AU and a latitudinal gradient of ≈1.2%/degree in both hemispheres. The measured mean radial gradient of ≈3%/AU is within the uncertainties in good agreement with the model predictions. However, the measured mean latitudinal gradient has a value of (0.33¿0.04)%/degree in both hemispheres at intermediate latitudes and is by a factor of 4 lower than expected. In the modified models the latitudinal gradient is in agreement with the measured ones when we increase the diffusion coefficient &kgr;&thgr;&thgr; perpendicular to the magnetic field in polar direction to a value of 15% of the diffusion coefficient parallel to the magnetic field. The latitudinal gradients >106 MeV protons calculated by modified modulation models are in very good agreement with the measured ones at intermediate latitudes. At lower latitudes, when Ulysses is embedded in the streamer belt, the models predict approximately the same latitudinal gradient than at intermediate latitudes, whereas the measured ones are significant smaller, or even vanishing. The observations support the previous conclusion from Paizis et al. [1995> that a significant latitudinal gradient is only observed when Ulysses is outside the streamer belt. Another remarkable observation is the difference of the radial gradient Gr at ~3.5 AU in the southern (Gr≈3.5%/AU) and in the northern hemisphere (Gr≈2.3%/AU). Probable reasons for the significantly lower radial gradient in the northern hemisphere can be either a spatial asymmetry of the heliosphere or temporal variations. ¿ 1998 American Geophysical Union