Israeli forces opened fire on a "suspect" vehicle in the occupied West Bank on Tuesday, killing one Palestinian and wounding another, Israel's army and the Palestinian health ministry said.

An army statement said a vehicle approached Israeli soldiers in a suspicious manner near the Jewish settlement of Halamish and the Palestinian village of Nabi Saleh.

"The soldiers perceived the vehicle as a threat and consequently fired towards it in order to stop it," it said.

The Palestinian health ministry said one man was killed, identifying him as 26-year-old Mohammed Mussa.

His sister Latifa, 33, was shot in the shoulder and was later treated in hospital.

Speaking to reporters, she said they were on their way to run errands when the Israeli soldiers started firing.

"There were two soldiers behind stone barriers on the street. They suddenly began shooting at us without any warning. My brother tried to protect me," she said.

"After that I saw he was breathing, but the soldiers left him alone."

He was confirmed dead later after being taken to an Israeli hospital.

Israel's military said no soldiers were wounded and "the event is being reviewed".

A wave of unrest that erupted in October 2015 has claimed the lives of at least 303 Palestinians or Arab Israelis, 51 Israelis, two Americans, two Jordanians, an Eritrean, a Sudanese and a Briton, according to an AFP toll.

Israeli authorities say most of the Palestinians killed were carrying out knife, gun or car-ramming attacks.

Others were shot dead in protests and clashes, while some were killed in Israeli air strikes on the Gaza Strip.

Separately on Monday, Israel's military blew up a tunnel it said stretched from the Gaza Strip into Israel and it said could be used for attacks, killing seven Palestinian militants.

Source: AFP