
The Palestinian militant group Islamic Jihad said the man was one of its members, but it did not disclose what he was doing in the area.
In a statement, the Israeli military said soldiers opened fire at two Palestinians placing an explosive device next to the fence in the Hamas Islamist-run enclave.
It said one of the men was killed and a military bulldozer removed his body.
Witnesses and health officials said two other Palestinians were wounded by Israeli gunfire directed at a group of people that had approached the area and tried to recover the body.
Video footage shot by a Gaza photographer and posted on social media showed what appeared to be a lifeless figure dangling from the mechanical arm of the bulldozer, which was escorted by an Israeli tank.