(Adds Israel army comment)

NABLUS, West Bank, Oct 16 (Reuters) - Israeli troops shot and killed two Palestinians during a raid in the occupied West Bank on Tuesday, medical workers and security sources said.

Witnesses said Israeli soldiers entered the West Bank city of Nablus early on Tuesday and surrounded a residential building where Palestinian militants were holed up.

Hospital officials said a militant leader from the al-Aqsa Martyrs Brigade, an armed wing of Palestinian President Mahmoud Abbas's Fatah movement, had been killed and two other militants wounded in clashes with the soldiers.

An Israeli army spokeswoman there had been a firefight between armed Palestinians and Israeli forces on an arrest raid in Nablus.

Medics said a 70-year-old Palestinian civilian had also been shot dead during the raid. The Israeli army said the man had not been involved in the clash but in a house nearby, and it was unclear who had shot him.

Israeli forces frequently raid West Bank towns in search of militants suspected of involvement in attacks against Israelis.

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