A Palestinian has been killed by Israeli soldiers during an incursion into the northern West Bank town of Qabatiy, medical sources say.

Nasser Zakarneh, a 23-year-old civilian, was killed on Tuesday by Israeli soldiers who opened fire in an operation to arrest fighters from Islamic Jihad, witnesses and medics said.

Israeli military sources said a soldier was also shot and wounded in the clashes in Qabatiy, south of the West Bank city of Jenin.

Aljazeera's Palestine correspondent reported two others were injured along with the Israeli soldier.

The death comes after Israeli soldiers and Palestinian fighters engaged in a shootout on Tuesday as troops entered the West Bank city of Jenin.

Gunfight

The military said it entered the Palestinian town on Tuesday morning in an operation to arrest a senior member of the Islamic Jihad group.

The gunfight broke out when the senior leader and other fighters holed up in a house that was surrounded by Israeli soldiers.

An Israeli military helicopter hovered overhead during the operation.

In response to the clashes, Israeli forces imposed a curfew in Abu al-Rub - a neighbourhood in Qabatiy - and surrounded a house where they suspect the leader of al-Quds Brigades to be hiding, Aljazeera's correspondent reported.

The al-Quds Brigades is Islamic Jihad's military wing. 

Rocket attacks

In another attack, Palestinian fighters in the Gaza Strip fired at least three makeshift rockets at an Israeli border town on Tuesday, damaging an apartment building but causing no serious casualties, the Israeli army said.

Hamas' military wing, the Izz al-Din al-Qassam Brigades claimed responsibility for the salvo on Sderot, calling it a response to a confrontation between Israeli police and Palestinians at a Muslim shrine in Jerusalem on Monday.

"Any harm that befalls al-Aqsa mosque will mean an open, fierce war in all of our land of Palestine, and by all means," the Hamas military wing said in a statement.

Hamas and other Palestinian fighter groups have largely abided by a truce declared by President Mahmoud Abbas and Israeli Prime Minister Ariel Sharon in February.

An army spokeswoman said two Sderot residents were treated for shock after a rocket hit their building.

Past cross-border rocket strikes that caused bloodshed often prompted Israeli military sweeps of occupied Gaza, which Israel plans to quit in mid-August under a plan by Sharon to "disengage" from four-and-a-half years of conflict with the Palestinians.

Israeli officials have vowed not to withdraw soldiers and settlers under fire.

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Israeli soldiers.(AFP)