Palestinian officials said the raid began with several Israeli military vehicles entering Dheisheh refugee camp, located just south of Bethlehem, early on Monday morning.
Local sources said Israeli snipers were positioned on the rooftops of houses and buildings overlooking the camp, before clashes broke out between residents and troops.
Israeli forces then fired dozens of live rounds, rubber-coated steel bullets, tear gas canisters and stun grenades to disperse the crowd.
The Palestinian health ministry identified the 22-year-old victim as Omar Yousef Manna’ Fararja, saying he was killed after being shot in the chest.
The ministry added that six other Palestinians were wounded by Israeli forces’ live fire. Palestinian medical staff rushed them to Bethlehem hospitals for treatment.
Israeli troops also ransacked many homes in the refugee camp, and abducted three Palestinians, including Omar’s 24-year-old brother, Yazan.
The development comes a few days after the fatal shooting of a young Palestinian man by Israeli forces in the northern part of the West Bank.
Video footage widely circulated on social media showed an Israeli soldier holding the Palestinian man, identified as 22-year-old Ammar Mefleh, in a headlock by a road in the town of Huwara, south of Nablus, on Friday as two other men try to wrestle him away.
The man then appears to strike the Israeli soldier, before the trooper pulls out a handgun and shoots him several times at point-blank as he falls to the ground.
Israeli forces present at the scene prevented residents and ambulances from providing aid to the injured Palestinian youth, provoking clashes with locals.
The Palestinian health ministry said Mefleh died of his critical wounds.
Israeli forces have recently been conducting overnight raids and killings in the northern occupied West Bank, mainly in the cities of Jenin and Nablus, where new groups of Palestinian resistance fighters have been formed.
Since the start of 2022, Israeli troops have killed more than 200 Palestinians, including more than 50 children, in the occupied West Bank and East al-Quds as well as the besieged Gaza Strip.
According to the United Nations, the number of Palestinians killed by Israel in the occupied West Bank this year is the highest in 16 years.
Local and international rights groups have condemned Israel’s excessive use of force and “shoot-to-kill policy” against Palestinians.