About 5,000 people participated in the demonstrations, the Israeli army said.
The death raises to 42 the number of Palestinians shot dead by Israeli forces since weekly protests began on March 30. He has raised the possibility of a mass border breach, comparing protesters to a "starving tiger", unpredictable and full of pent-up anger.
There are growing concerns that if Israel and Hamas dig in, a widespread border breach in coming days could lead to large numbers of casualties. Israel's position has generally been that Palestinian refugees and their descendants would become citizens of a Palestinian state at the culmination of the peace process, just as Jews who fled or were forced out of Middle Eastern countries by hostile governments became citizens of Israel. Israel says this is vital to prevent Hamas - which has fought three rounds of conflict against Israel since seizing Gaza, firing thousands of rockets into Israel and digging dozens of attack tunnels under the border - from importing weaponry.
Deifallah, who is unemployed like nearly half the Gaza labor force, said he would also join Monday's protest and is not afraid to die. The demonstrations have been organized by Gaza's Hamas rulers, but are fueled by despair among the territory's 2 million residents.
On Friday, thousand of Palestinians gathered along the Israel-Gaza frontier. Rights groups say the use of potentially lethal force against unarmed protesters is unlawful. Hamas seeks an Islamic state in the entire historic Palestine, including what is now Israel, but has said it is ready for a long-term truce.
The ceremony is scheduled as part of the 70th anniversary of Israel's declaration of independence, on the eve of what Palestinians commemorate as the Nakba Day, or "Day of the Catastrophe", in memory of the forcible transfer of two thirds of the Palestinian people and ethnic cleansing of at least 418 villages as a result of the 1948 war.
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Specialized IDF drones created to destroy the burning kites midair were used successfully for the first time during Friday's protests, Walla news reported.
"The detection of the tunnel and its demolition is part of the ongoing effort to thwart the underground terror by Gaza-based terror groups headed by the Palestinian terror group Hamas", the military said, adding that the operation was part of increased efforts to detect tunnels using advanced technological means. An IDF official told the news website that the drones destroyed over 40 burning kites throughout the border demonstrations.
Egypt opens the crossing from time to time, mainly to allow people in special categories, including medical patients and Gaza residents studying overseas, to leave the territory or return to it. Jordanian, Palestinian, and green Muslim Brotherhood flags flew over crowd.
It was the seventh weekly protest, and a preview of what is expected to be a much larger border rally on Monday and Tuesday.
Meanwhile in the West Bank, Israel's military said an assailant rammed his vehicle into a soldier, causing light injuries.
In an Instagram post with a picture of herself touching the Western Wall during her visit last May, she wrote, "With great joy, I am returning to Jerusalem".