Tel Aviv, Israel - An Israeli soldier was killed by live fire in Jenin refugee camp, the army announced, as it began withdrawing forces from the area in the occupied West Bank after two days of a large-scale operation that also left 12 Palestinians dead.

The raid on Jenin refugee camp, launched early Monday under Prime Minister Benjamin Netanyahu's hard-right government, 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 had wounded seven people before the suspect was shot dead on the second day of Israel's biggest military operation in years in the occupied West Bank.

"This evening (Tuesday) a non-commissioned officer in combat service was killed by live fire during the operation against terrorist infrastructure in the Jenin camp," the Israeli army said.

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The large-scale Israeli army assault has so far killed 12 Palestinians, the Palestinian health ministry said.

On Tuesday, explosions had been heard from the camp and a drone hovered overhead, an AFP correspondent reported.

"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.

The army said it had uncovered militant hideouts, arms depots and underground shafts used to store explosives.