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Nabi Saleh (Palestinian Territories) (AFP)

Israel on Tuesday denied its forces shot a Palestinian teenager and said he suffered a severe head injury when he fell off his bicycle, sparking outrage from activists and his family.

Mohammed Tamimi, 15, confirmed to AFP that after being arrested from his home in the middle of the night he had told Israeli interrogators the cause of his misshapen skull was falling off his bike, not being shot.

But he said it was only because he was afraid of being charged with involvement in a protest, adding that "they knew" he was lying.

A cousin of prominent jailed Palestinian teenager Ahed Tamimi, he says he was shot in the head with a rubber bullet during a protest in the occupied West Bank in December, leaving part of his skull missing.

Israeli rights group B'Tselem produced medical documents appearing to verify that Tamimi was shot.

The family has also presented what they say is an X-ray showing the bullet wound.

It occurred the day Ahed, then 16, slapped and kicked two soldiers next to her house in a video that later went viral.

She faces a long potential jail sentence in a case that has gained international attention.

Mohammed's alleged shooting has been a key line of defence for Ahed's actions by her lawyer in court hearings.

But on Tuesday, an Israeli defence ministry unit that oversees affairs in the Palestinian territories said Mohammed had confessed the injury was the result of falling off a bike.

"In December 2017, the young man Mohammed Tamimi injured his skull when he was riding his bicycle and fell off," it said in an Arabic language statement posted on Twitter.

"Today his father Abu Fadel Tamimi is claiming in the media that his son was injured by a rubber bullet in his skull," it said, adding in bold red letters "fake news".

- 'Obviously a bullet wound' -

The claim of the bike accident came from an hour-long interrogation of Mohammed on Monday after he was detained along with a number of other residents from Ahed's village of Nabi Saleh.

Mohammed confirmed that was what he had told investigators but said it was clear to everyone he was lying.

He said he had been arrested from his home at 3:00 am Monday and moved between locations before being questioned by two Israeli officers at around 9:30 am without a lawyer or guardian.

He said he was afraid they would charge him with something as he had attended a protest where he had been shot.

"I told them I fell from my bicycle. They said 'oh, ok.'"

Asked why he lied, he said "they wanted to jail me." He added that the two investigators "knew" that the claim was bogus.

He said he came up with the bike story after seeing a bicycle from the car while being driven to be interrogation.

B'Tselem produced what it said were complete medical notes from the hospital in Ramallah showing Mohammed was taken there with a "bullet injury".

Jonathan Pollak, an Israeli activist who said he was at the demonstration, told AFP he was around 20 metres (yards) away when Mohammed was shot.

He said the teenager was climbing a ladder towards a house which Israeli soldiers were in.

Pollak said he heard the shot but did not see it, though afterwards it was clear to him and others that it was a bullet injury.

"This was one of the bloodiest injuries I have ever seen. He had a hole in his face to the left of his sinus. I was worried he would suffocate to death from all the blood... It was very obviously a bullet wound."

This version of events was confirmed by Mohammed's father.

The protest took place against the backdrop of US President Donald Trump's controversial recognition of Jerusalem, which sparked major protests by Palestinians.

© 2018 AFP