Israel police opened fire into a car that was attempting to run into them in east Jerusalem.
Officials say the driver was killed and a passenger in the car was wounded Monday in the incident outside the Shufat refugee camp.
More than 200 Palestinians and 34 Israelis have been killed in an upsurge in violence in the past year.
Israel blames the violence on a campaign of incitement by Palestinian political and religious leaders.
The Palestinians say the violence is the result of frustration due to the decades of occupation.