The killing sparked a wave of clashes in the occupied east Jerusalem where around 200 young Palestinians threw stones at police, who responded with sound bombs and rubber bullets, an AFP correspondent and police said.
Quoting witnesses, the radio said the youth was seen being forced into a car in the Arab eastern half of the occupied city. A body was found shortly afterwards in another part of the city, the radio said, describing it as a "suspected revenge attack" for the kidnapping of three Israeli settlers from the southern West Bank on June 12.
Police spokeswoman Luba Samri confirmed they were investigating reports of a kidnapping and said they had found a body but refused to say whether the two incidents were connected.
Quoting witnesses, army radio said a black car had stopped next to a youth who was hitchhiking and he was forced inside. The car then took off. Sometime later, the family of the youth, who is understood to be around 16, reported him missing, it said. The body was discovered in a forest in southwest Jerusalem.