The family of Yasir Abu Laimun, 32, said he was killed accidentally in Talluza, north of Nablus on Friday, but an Israeli occupation army spokeswoman said he was part of a group of four wanted resistance fighters and a member of Hamas.
Abu Laimun's wife said he was a university professor and not known for his political affiliations.
She said he was outside his house when a stray bullet killed him and complained troops had prevented an ambulance from evacuating him to a nearby hospital.
Palestinian security sources said Abu Laimun's neighbour and Hamas member Imad Janajri had in fact been wanted by Israel.
The army spokeswoman said four wanted men had been surrounded by troops in an open field.
"Forces conducted an operation to arrest four wanted militants. When they opened fire at us, we returned fire and one of them was killed," she said.
"The dead man was a Hamas member and he was armed. The three other militants managed to escape," she added.
Toll continues to rise
The latest death brings the overall toll since the September 2000 start of the Intifada, to 3937, including 2968 Palestinians and 899 Israelis.
The Israeli army has shot child
stonethrowers in Gaza
Earlier on Friday Israeli troops killed three members of Palestinian leader Yasir Arafat's Fatah movement Qalqiliya in the north of the West Bank, Palestinian medical sources said.
The three were shot by a "special unit" disguised as Palestinians who arrived in an unmarked car, security sources said.
A fourth Palestinian, Atif Shaaban, head of the armed group al-Aqsa Martyrs Brigades which is linked to Fatah, was seriously wounded by the Israeli unit.
The dead, aged between 20 and 25, were named as Abd al-Rahman Nazal, a member of the al-Aqsa Martyrs Brigades, Muhammad Nazal and Muhammad Odih, two Fatah political activists.
Attack on soldiers
Meanwhile, two resistance groups claimed a joint attack on Israeli soldiers on Thursday near the Jewish settlement of Kfar Darom in the southern Gaza Strip, in a statement sent to AFP on Friday.
"The attack came in response to massacres perpetrated by the Zionist enemy"
A statement by the Al-Aqsa Martyrs Brigades, and the Popular Resistance Committee
An Israeli army spokeswoman told reporters two soliders were moderately wounded by anti-tank fire.
An offshoot of Yasir Arafat's Fatah party, the Al-Aqsa Martyrs Brigades, and the Popular Resistance Committee - a group consisting of ex-Fatah activists - said they "hit a military outpost north of Deir al-Balah and wounded two Zionist soldiers."
"The attack came in response to massacres perpetrated by the Zionist enemy," the statement also said.
On Thursday, five Palestinians including two young girls were killed by Israeli occupation soldiers in the occupied Gaza Strip and the West Bank.
Four-year-old Asma abu Klaik
was buried on Friday in Gaza
Palestinian medics said a four-year old girl died of tear gas inhalation while another girl, aged nine, and a teenager were killed by gunfire from invading troops.
The Israeli army claimed Palestinian fighters, operating near youngsters, had hurled grenades and fired automatic weapons and an anti-tank missile at the soldiers, who shot back at them and also used tear gas and rubber-coated bullets to disperse the stone-throwers.
"We did not fire at residential buildings or children," an Israeli army spokesman said.
Dr Mahmud al-Asali, director of Jabalya hospital in Gaza, said one victim, four-year-old Asma Abu Klaik, was admitted with respiratory problems.
"Her skin had turned blue as a result of her inability to breathe and she soon died," he said. "We have enough proof to declare that gas inhalation caused her death."
Medics said the nine-year-old girl who died was hit by a bullet that penetrated her home.