Israeli police said that the boy, Ronen Landau, was being driven home by his father when Palestinians in a moving vehicle opened fire on the vehicle the two were in.

"Shots were fired from a truck at children in a playing field... where apparently no one was hurt. Then the truck drove on and (the assailants) shot at a car and killed one person," a security source told Reuters news agency.

Medical workers failed to revive the boy, who was shot in the head.

An Israeli minister was travelling on the road where the attack happened a short time before it took place.

About 30 Jewish settlers have been killed in drive-by shootings since the present wave of unrest between Israelis and Palestinians began last September.

Last week, a three-month old baby was among three Palestinians shot dead in the West Bank in an attack carried out by Israeli vigilantes.

'Imaginary ceasefire'

In the wake of the latest killing, Israeli settler leaders called for an end to what they described as the imaginary ceasefire.

A spokesman for Israel's Prime Minister, Ariel Sharon, said the killing showed that the Palestinians had decided to continue their campaign of terror.

A BBC correspondent in Jerusalem says there is a fear that while diplomatic efforts are continuing to underpin an US-negotiated ceasefire, extremists on both sides are continuing to determine what happens on the ground.

Overall, more than 600 people have been killed in the violence - about 500 of them Palestinians.