Ahmed Abu Hussein, 25, was shot on April 13 while covering protests along the Gaza border for a radio station based in the Palestinian enclave.
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The Gaza health ministry announced he had died after receiving treatment inside Israel, which the Sheba hospital near Tel Aviv confirmed.
His brother Diaa told AFP they were preparing to transfer the body to Gaza for burial.
Abu Hussein worked for Radio Shaab, a Gazan radio station, as well as being a photographer for another local news agency.
He was shot in the stomach while covering protests near Jabalia in northern Gaza, the health ministry in Gaza said.
Fellow journalist Yasser Murtaja was killed earlier this month while covering the protests.
Abu Hussein's death brought the toll of Palestinians in Gaza killed by Israeli fire since March 30 to 41.
Most of the Palestinians killed by Israel since the start of "March of Return" protests on March 30 were shot by snipers on the border, while a few others were killed by Israeli artillery or air strikes.
The Israeli army says its troops only open fire in self-defence or to stop protesters attempting to breach the barrier separating the territory from Israel.
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