A Palestinian who was hit in the head by a rubber bullet during a protest which erupted after a prisoner died in Israeli custody has died of his wounds, medical officials say.

"Mohammed Asfour died this morning after being in hospital for a long time after he was injured during a demonstration," a spokesman for Tel Aviv's Ichilov hospital said on Thursday.

Asfour, a 22-year-old student studying sports, was wounded in the head by a rubber-coated steel bullet fired by Israeli troops during a demonstration in the West Bank village of Abud on February 22, activists said.

Israeli rights group B'Tselem demanded that the military launch an immediate inquiry into the incident and four other cases where Palestinians were seriously injured by army fire.

"[It]must not only examine the immediate circumstances in which Asfour was killed, but also the orders that were given for use of these bullets during the event, the measures that were taken to ensure soldiers' familiarity with the orders, and the command responsibility for the shooting," it said in a statement.

"The goal of holding the shooters accountable and preventing similar cases by deterring other soldiers must apply to cases of severe injury, as well as to cases of death," it added.

Asfour was initially taken to a Palestinian hospital but later transferred to Ichilov, they said.

The protest erupted after news leaked out that a Palestinian man had died in Israeli custody after being interrogated by the Shin Bet internal security service, sparking angry demonstrations across the territories.

Asfour was to be buried on Friday after the weekly prayers in his home village of Abud, some 20km northwest of Ramallah.

Months of hunger strikes

His death comes after weeks of heightened tensions across the West Bank over the issue of Palestinian prisoners held in Israeli jails, some of whom have been on hunger strike for months.

The strikes are to protest poor conditions inside the jails and the issue of administrative detention by Israeli forces of Palestinians.

The protests intensified on February 23 after news emerged that Arafat Jaradat, 30, had died after days of Shin Bet interrogation on suspicion of throwing stones.

Palestinian officials claim that a joint autopsy showed Jaradat died after being tortured, but Israel says further tests are needed to determine the cause of death.

Meanwhile, the Ramallah-based Prisoners Club said an Israeli military court had postponed a decision on whether or not to extend the detention without charge of two prisoners on long-term hunger strike.

Spokeswoman Amani Sarahne said the judge "wanted to re-examine the evidence before deciding whether to renew the administrative detention orders" against Tareq Qaadan and Jafar Ezzedine who have been on intermittent hunger strike since November.

Both men were arrested on November 22 and handed a three-month administrative detention order which was due to expire or be renewed by a military court on February 22.

Sarahne said the judge was expected to rule on the issue "within days".

Figures published by B'Tselem at the end of January show there are currently 4,500 Palestinians being held by Israel, of whom 159 are being held in administrative detention.