A military statement said that the incident occurred near Qalandia, north of Jerusalem.
Palestinian prisoners in Israel jails end hunger strike
"An assailant armed with a knife attempted to stab (Israeli) forces operating on a road," it said. "Forces fired towards the attacker."
An army spokeswoman later confirmed the attacker's death to AFP, as did the Palestinian health ministry in a statement without naming him.
Palestinian militant groups deny Islamic State claim of Jerusalem attack
A wave of unrest that broke out in October 2015 has claimed the lives of 273 Palestinians, 42 Israelis, two Americans, two Jordanians, an Eritrean, a Sudanese and a Briton, according to an AFP tally.
Israeli authorities say most of the Palestinians killed were carrying out knife, gun or car-ramming attacks.
Violence has subsided in recent months but last Friday an Israeli policewoman was stabbed to death in Jerusalem, with three Palestinian assailants shot dead.
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