A Palestinian man was killed by Israeli gunfire in the West Bank Saturday, Palestinian authorities said, in an incident Israel's army described as a "violent confrontation" between Palestinians and Jewish settlers.

An Israeli army statement did not confirm the fatality, but said troops had fired at a suspect who threw "a suspicious object that exploded on the soldiers", amid the unrest. 

The Palestinian health ministry said Mohammad Fareed Hasan, who was in his 20s, was killed in his village of Qusra near the city Nablus by Israeli gunfire, while two others were wounded.

"Hasan was standing on the rooftop of his home when he was shot dead," said a report on the official Wafa news agency. 

According to Wafa, Palestinians in Qusra, were "fending off an attack by hardcore Israeli settlers on the village". 

Israel's army said: "a violent confrontation between tens of Palestinians and Israeli settlers developed adjacent to the village of Qusra, south of Nablus, during which both sides hurled rocks at each other. 

"Troops who were present at the scene operated to distance both sides from the area using riot dispersal means.

"During the activity, a suspect was identified throwing a suspicious object that exploded on the soldiers, who responded by firing at the threat," the statement added. 

Jewish settlements in the West Bank, a Palestinian territory occupied by Israel since 1967, have proliferated in recent years. 

Clashes between Palestinians and Israeli settlers and troops are common. 

The Nablus area has seen heightened tension in recent days as Palestinians have held furious protests against the construction of an illegal Jewish outpost near the village of Beita. 

The settlers evacuated the outpost, known as Eviatar, on Friday in accordance an agreement they reached with Israel's new coalition government. 

There was no immediate indication of a link between the Eviatar fracas and Saturday's unrest. 

There are roughly 475,000 Jewish settlers in the West Bank, living alongside some 2.8 million Palestinians, in communities regarded as illegal by most of the international community.