About 10,000 protesters marched from Ramallah towards East Jerusalem, where they were met by Israeli forces.
At least 15 people died and scores were injured when an UN-run shelter came under fire in Gaza on Thursday.
More than 800 Palestinians and 35 Israelis have died since the Israel-Hamas conflict began on July 8.
Palestinian leaders in the West Bank have called for a “day of anger” on Friday, one of the last days of Ramadan.
The protest at Qalandia, outside Ramallah, saw Israeli border police use “riot control measures” and live fire. Protesters also used live ammunition, Israel said.
Large protests were also reported in Jerusalem on Thursday evening, after Israeli police prevented men under 50 from visiting the al-Aqsa mosque.
At least 20 protesters were arrested after they threw rocks at police, Israeli police said.
Israel launched its military offensive with the declared objective of stopping Hamas firing rockets into Israel.
It has since discovered a network of tunnels used by militants to infiltrate Israeli territory, and has vowed to destroy them to restore security.
Efforts to broker a ceasefire have been continuing despite the continued violence.
Reports suggest a deal under discussion could allow Israeli forces to remain in Gaza to destroy tunnels.
Palestinian leaders say this is the start of the “uprising of freedom and independence”. Thousands marched from the outskirts of Ramallah towards the Qalandia checkpoint calling for an end to the Israeli occupation.
Youths threw stones and petrol bombs towards the checkpoint and tried to destroy the barrier. Israeli police say they used percussion bombs and tear gas.
The demonstration was called for by a group of youths on Facebook, among them the son of the popular imprisoned Fatah leader Marwan Barghouti.
Palestinian President Mahmoud Abbas has urged Palestinians to expand the protests, and leaders in the West Bank have called for a “day of anger” on Friday.
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