The four had been travelling by car that was attacked by stonethrowers near the village of Beit Ummar, a police spokeswoman said.
When they got out of the car, the assailant drove into them.
Israeli soldiers arrived on the scene and opened fire on the Palestinian, seriously wounding him, the spokeswoman added.
All five were taken to hospital.
This was the latest in a series of attacks on Israelis that, along with violent protests in the Palestinian territories, have raised fears of a full-blown uprising.
Most of the incidents have seen young Palestinians stab Israelis before being shot dead. Shootings and car-ramming attacks have also occurred.