Israel Defense Forces troops shot and killed an armed Al-Aqsa Martyrs' Brigades operative in the Balata refugee camp near the West Bank city of Nablus early Friday during an operation involving searches for wanted militants, weapons and ammunition.

Hitam Saleh, 28, was killed as he fled from a taxi. The IDF said soldiers saw two armed men entering a taxi, followed the vehicle, then opened fire at one of the gunmen who jumped out of the vehicle.

The Palestinians originally said the dead man, Hitam Saleh, 28, was an unarmed taxi driver who didn't heed soldiers' orders to stop at a roadblock, but the Fatah-affiliated Martyrs' Brigades later confirmed the IDF's version of events.

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The IDF cracked down on militants in Nablus and nearby refugee camps this week after its incursions into the Hamas-controlled Gaza Strip wound down. By Friday morning, the soldiers had withdrawn from the Nablus area, too.

On Thursday night, the IDF uncovered an explosives lab and three hidden arms caches containing 10 bombs, bomb-making material, rifles and grenades, the army said.

IDF troops also arrested two wanted Palestinians, Israel Radio reported.

Palestinians opened fire on the forces overnight and detonated an explosive device near the troops, causing no injuries, according to the report.

At least five IDF soldiers were wounded Thursday in clashes with Palestinian militants during an arrest raid in Nablus, one of them seriously and three moderately.

Palestinian Prime Minister Salam Fayad slammed the IDF operation.

"We view this aggression as a way to undermine our efforts to provide security and end the chaos," he said Thursday at a conference in the West Bank city of Ramallah.

Prime Minister Ehud Olmert's spokeswoman, Miri Eisin, said the government is committed to working with Palestinian Authority Chairman Mahmoud Abbas, but would not risk the safety of its own citizens.

"Israel will always fight terror," she said. "We will go forward with full strength to strengthen Abbas, and full strength to stop the terror."