It is the latest death to be reported amid a sharp increase in violence in the region.
Khalil Yahya Anis, 20, was shot in the head in Nablus, the Palestinian Health Ministry said.
The city is a frequent flashpoint for confrontations between the Israeli military and Palestinians.
The Israeli military said troops operating in the city came under fire and shot back. The troops were demolishing the home of a Palestinian linked to the killing of an Israeli soldier last year.
Israel demolishes the homes of attackers in what it says is a deterrent against future attacks. Critics say the tactic amounts to collective punishment.
Tensions are high between Israel and the Palestinians after months of violence, focused mainly in the West Bank, where about 120 Palestinians have been killed this year.
Israel has been staging near-nightly raids in the West Bank. Palestinian attacks against Israelis surged during that time.
Israel said most of those killed in the West Bank were militants, but young people protesting against the incursions have also been killed.
Twenty people have been killed in Palestinian attacks against Israelis this year.