The activists were members of the al-Aqsa Martyrs' Brigades, the armed wing of Palestinian President Yasir Arafat’s Fatah movement, said Palestinian witnesses on Wednesday.
The activists were killed in a brief gunfight, said witnesses. The car was riddled with bullets and the occupation troops immediately left the area after the attack.
The Israeli army said it had entered the city to round up a number of Palestinian activists and shot men they claim were armed and had taken aim at the soldiers.
It was one of the highest death tolls of Palestinian activists in the West Bank in weeks.
Arafat condemned the attack as a "massacre".
"We ask the quartet to act or at least send observers" to the
region, said Arafat said in reference to the United Nations, United States, European Union and Russia.
Israel regularly launches invasions of occupied Palestinian areas, detaining activists and civilians they say are participating in the Intifada or uprising against Israel’s occupation.
The killings came just hours after sources from both sides said a long-delayed meeting between Palestinian Prime Minister Ahmad Quraya and his Israeli counterpart Ariel Sharon would take place next week.