Occupation forces seized Adnan Asfur in the early hours of Sunday, reported Aljazeera correspondent Hasan al-Titi.
"Israeli forces arrested on Sunday at 03:00am (01:00 GMT) Adnan Asfur, a Hamas leader in Nablus, who has been wanted by Israel," he said.
Asfur, 40, on Israel's wanted list for two years, was arrested at his father's home in the al-Massya district.
Asfur is a political activist and spokesman for Hamas in the West Bank and is not believed to have a military role in the resistance group.
Israeli troops have been conducting intensive raids in Balata camp, located near Nablus, since 16 December.
"They have also occupied many houses in the camp and in the surrounding areas," added al-Titi.
Places of worship have not been spared.
On Friday, troops stormed the camp's Ibad al-Rahman mosque for the second time in the operation, searching its interior and scattering its contents.
"Clashes continued between Israeli forces and residents, causing more injuries among Palestinians," al-Titi reported.
"An atmosphere of high tension prevails among residents of the camp who are prevented from performing their daily activities."
The Israeli army says that the invasion is part of their campaign to root out "terrorists" in the camp.
On 16 December, occupation troops surrounded the camp and set up snipers. Around 50 residents are reported to have been forced at gunpoint into a single apartment and restrained according to Palestinian media reports.
Boy in coma
A Palestinian boy, Ahmad Ismail, was left in a coma after being shot in the head by Israeli troops. Eight more Palestinians were injured including a two-year-old boy.
Ahmad Ismail,12, was wounded
in the head by a rubber bullet
Paramedics working for the Palestinian Red Crescent Society (PRCS) in Nablus confirmed that three resistance fighters and one civilian had been killed in the city since the invasion began.
"One of the men had been hit by at least 35 bullets - he was killed in al-Shuhada square in the centre of Nablus," said the medical worker.
The PRCS has named one of the dead men as 25-year-old Alaa al-Din Dawaia, from Nablus who was killed on 18 December. According to PRCS workers, Dawaia was denied medical attention by soldiers.
Israeli occupying forces claim that Dawaia was attempting to plant an explosive device in the path of an Israeli military vehicle.
The PRCS says that eyewitnesses told the organisation that the man was on his way to work at a local bakery when he was killed.
A Palestinian suspected of collaborating with Israel was killed on Saturday by masked men in Qalqilya in the northern West Bank, Palestinian security officials said.
The officials added that the man's body was found in a street in the town.
Meanwhile, a Palestinian died on Sunday from wounds he received from Israeli gunfire in Qalqilya in February 2002, Palestinian hospital sources said.
The latest death brought to 3652 the number killed since the beginning of the al-Aqsa Intifada in late September 2000, including 2732 Palestinians and 854 Israelis.