The forces, backed by Israeli tanks and bulldozers, entered the Palestinian town of Jenin around midday on Wednesday and surrounded the home of an Islamic Jihad member, witnesses said.
Aljazeera correspondent in Jenin reported that Israel had besieged the eastern part of the town with more than 30 military vehicles and four bulldozers.
Seven Palestinians were injured during the incursion, some while throwing stones.
Yusuf Haseef, a 15-year-old bystander, was shot in the head by Israeli forces and taken to hospital in the nearby city of Nablus where he died, paramedics said.
Israeli troops launched the operation to detain a member of Islamic Jihad's armed wing, the Al-Quds Brigades.
An Israeli military source said they were fired at from surrounding houses after troops encircled the building where Hamza was hiding.
"The force entered Jenin and surrounded the structure where he was hiding. They asked him to come and he did come out, but the troops came under fire from surrounding buildings while an explosive device was detonated."
Israeli occupation forces were
backed by tanks and bulldozers
"Two soldiers were lightly wounded," she said.
Israeli bulldozers and equipment were brought to the eastern neighbourhood to demolish the home, witnesses told Aljazeera.
An Islamic Jihad spokesman later said one of the group's members was arrested by Israeli forces.
Aljazeera's correspondent added that Israeli troops seized several Palestinian homes and detained residents.
Meanwhile in Gaza, Aljazeera's correspondent reported that thousands of Palestinians had been restricted from entering Gaza at the Abu Holi military checkpoint, which separates southern Gaza from the central and northern parts of the city.
Residents were prevented from returning to their homes after Israeli forces closed the checkpoint indefinitely.
Israel later partially reopened the military checkpoint.
Palestinian girl wounded
In an another attack on Wednesday, a four-year-old Palestinian girl was seriously wounded by Israeli forces in the Rafah refugee camp in the south of the Gaza Strip, Palestinian medical sources said.
Israel closed a Gaza checkpoint
and later partially reopened it
The girl, in a critical condition with serious head wounds was taken to Rafah hospital.
The sources said she was hit in shooting from a nearby Israeli military post while at home.
The Israeli army has, however, categorically denied any firing by its forces in the Rafah area.