The Israeli military said troops shot a man at the hospital while they were there to arrest a suspect in a stabbing attack.
Jihad Shawar, the director of Al-Ahli hospital in the West Bank city of Hebron, said more than 20 undercover Israeli forces posing as locals, including one pretending to be a woman in labor, entered the hospital.
They went to the surgical unit, where they pulled out their guns and stormed a room where Azzam Shalaldeh was being treated for gunshot wounds, he said.
"This is an outright crime. This is against international law. No one should violate hospitals, but Israel did," Shawar said.
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The Israeli military said forces entered the hospital to arrest Azzam Shalaldeh, who they say stabbed an Israeli last month. During the arrest, a man at the hospital attacked the troops, who responded by shooting him, the military said.
The Israeli military did not provide additional details of the operation, or say whether the troops were undercover. It also did not give the identity or condition of the man who was shot.
Shalaldeh was being treated at the hospital for gunshot wounds, which the military said were sustained when the Israeli he stabbed last month shot him.
The raid comes as a nearly two month-long outburst of Israeli-Palestinian violence shows no signs of abating.
Twelve Israelis have been killed in a spate of attacks by Palestinians, while 78 Palestinians have been killed, 50 of them said by Israel to be attackers, and the remainder killed in clashes with Israeli forces.
The violence erupted in Jerusalem over tensions surrounding a holy site sacred to both Jews and Muslims and quickly spread into Israel, the West Bank and the Gaza Strip.