A spokesperson for the ministry said in a statement "Bissam Safi, 22, died this morning".
He said he had been hit in the head with a tear gas cannister on February 22 during protests and clashes near Khan Yunis in southern Gaza.
Israel strikes Hamas targets in Gaza over rocket: army
For nearly a year protesters have been gathering along the border calling for Palestinian refugees and their descendants to be allowed to return to former homes now inside Israel.
Israeli officials say that amounts to calling for the Jewish state's destruction and accuse the Gaza Strip's rulers Hamas of orchestrating the protests.
At least 254 Palestinians have been killed by Israeli fire since the protests began in March 2018, the majority shot during weekly border protests and clashes.
Palestinian killed by Israeli fire during Gaza border clashes: Gaza ministry
Others have been hit by tank fire or air strikes in response to violence from Gaza.
Two Israeli soldiers have been killed over the same period.
Israel and Hamas, which has controlled the blockaded Gaza Strip for over a decade, have fought three wars since 2008.
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