Twelve Palestinians and an Israeli soldier have been killed during the assault on Jenin refugee camp, launched early Monday under Prime Minister Benjamin Netanyahu's hard-right government.

The raid, Israel's biggest military operation in years in the West Bank, employed hundreds of troops as well as drone strikes and army bulldozers that ripped up streets.

Elsewhere, a car ramming and stabbing attack in Tel Aviv on Tuesday wounded seven people before the suspect was shot dead.

The large-scale Israeli army assault on Jenin camp had so far killed 12 Palestinians, the Palestinian health ministry said.

During the operation, an Israeli soldier was also killed by "live fire" late Tuesday, the army announced.

Early Wednesday, the army said it carried out air strikes on the Gaza Strip after it intercepted five rockets fired at Israeli territory.

A Palestinian security source said the attack hit a military site of the militant group Hamas in northern Gaza but caused no injuries.

Late Tuesday, an Israeli army spokesman said troops "have started withdrawing from Jenin camp".

During the raid, the army said it had uncovered militant hideouts, arms depots and an underground shaft used to store explosives.

"In the last five years, this is the worst raid," said Qasem Benighader, a nurse at a hospital morgue.

The army said its forces had dismantled six explosives manufacturing facilities and three operational situation rooms in Jenin, and confiscated large quantities of weapons.

"The weapons were located in hideouts, a mosque, pits concealed in civilian areas, operational situation rooms, and in vehicles," it said.

- 'Cut off from the world' -

The Palestinian foreign ministry labelled the escalation "open war against the people of Jenin".

Medical charity Doctors Without Borders also condemned Israeli forces for firing tear gas inside Khalil Suleiman hospital in Jenin, calling it "unacceptable".

Palestinian health minister Mai al-Kaila even accused the army of shooting at Palestinians in a courtyard of the Jenin public hospital.

"Israel's aggression reached its climax this afternoon when citizens were shot at directly in the courtyard of Jenin hospital wounding three, two of them seriously," the minister told reporters, adding that forces had also stormed the Ibn Sina hospital.

The Israeli army said there were reports on social media regarding fire by soldiers towards a hospital.

"The reports are not currently known to security forces," it said, adding that "terrorist organisations have exploited civilian areas as a hideout".

Shops in Jenin were shuttered amid a general strike and the near-empty streets littered with debris and burned roadblocks.

"The most dangerous is what happened inside the camp, where there is no electricity, no water, and no roads for those who need to go to hospital," Jenin mayor Nidal Abu Saleh told AFP.

Around 3,000 people had fled their homes in the refugee camp since the assault commenced, said deputy governor of Jenin, Kamal Abu al-Roub.

Imad Jabarin, one of those leaving the rubble-strewn camp, said: "All aspects of life have been destroyed, there is no electricity and no communications... we are cut off from the world to some extent."

The northern West Bank has seen a recent spate of attacks on Israelis as well as Jewish settler violence targeting Palestinians.

The Israel-Palestinian conflict has worsened since early last year, and escalated further under the Netanyahu government, which includes extreme-right allies.

Hamas, meanwhile, praised the "heroic" attack in Tel Aviv as "an initial response to crimes against our people in the Jenin camp".

The driver in Tel Aviv was thought to have intentionally hit several pedestrians on a shopping street before getting out of the vehicle to "stab civilians with a sharp object", police said.

The "terrorist", a West Bank resident, was shot dead by an armed civilian passerby, said police chief Yaakov Shabtai.

- 'Strengthen settlements' -

The United Nations decried the violence in Tel Aviv and Jenin.

"The killing, maiming and the destruction of property must stop," UN rights chief Volker Turk said.

In the Israeli-blockaded Gaza Strip, protesters burned tyres near the border fence with Israel.

Israel has occupied the West Bank since the Six-Day War of 1967.

Excluding annexed east Jerusalem, the territory is now home to around 490,000 Israelis in settlements considered illegal under international law.

The Palestinians, who seek their own independent state, want Israel to withdraw from all land it seized in 1967 and to dismantle all Jewish settlements.

Netanyahu, however, has pledged to "strengthen settlements" and expressed no interest in reviving peace talks, which have been moribund since 2014.

At least 190 Palestinians, 26 Israelis, one Ukrainian and one Italian have been killed this year, according to an AFP tally compiled from official sources from both sides.

They include, on the Palestinian side, combatants and civilians, and on the Israeli side, mostly civilians and three members of the Arab minority.

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