Sunday's killing and another stabbing of a pregnant woman inside an Israeli settlement on Monday further boosted tensions after months of unrest, raising fears of an escalation in violence as well as a harsh Israeli crackdown on Palestinians.
Most of the previous knife attacks occurred in public places, including checkpoints and junctions.
Sunday's incident saw the woman stabbed to death at her home in the Otniel settlement while some of her children were in the house.
Even after the arrest was announced, Palestinian workers were being temporarily barred from Israeli settlements in the West Bank as part of security measures.
The family of arrested 15-year-old Murad Ideis said the raid occurred around 2:00 am at their home in the Palestinian village of Beit Amra near Otniel.
Brief video footage of the raid distributed by the Israeli military showed forces arriving at a home in darkness before entering and advancing into a bedroom, where it appears two people are sleeping. The footage ends there.
Ideis's father defended his son, saying such an attack would be out of character.
"His life is only school and home," Badr Ideis told AFP at his home.
"I don't believe this. I know my son. Even if he tells me 'dad I did it,' I won't believe it. I won't believe a 15-year-old-ignorant kid. How could he do this?"
Controversial demolitions
Netanyahu, during a visit to Otniel and facing pressure over a wave of Palestinian attacks, pledged to destroy the house where the suspect lives with his family.
Israel regularly demolishes the homes of alleged attackers in what it describes as a deterrent. Rights groups say it amounts to collective punishment, with families forced to suffer for the acts of relatives.
Netanyahu again accused Palestinian leaders of stirring up violence.
"The hatred that caused this murder has an address," he said.
"It is the incitement campaign led by the Palestinian Authority and other elements such as the Islamic Movement and Hamas, and it is about time the international community stopped their hypocrisy and called things by their names."
A wave of Palestinian knife, gun and car-ramming attacks erupted in October, and many of the assailants have been young people, including teenagers.
Some analysts say the attacks have been in part driven by frustration with the complete lack of progress in peace efforts, as well as by Israel's occupation of the West Bank and the fractured Palestinian leadership.
Israel says incitement by Palestinian officials and news media has been a main cause of the violence.
In Sunday's attack, the Israeli army initially said the assailant broke into the home of Dafna Meir, a 38-year-old nurse and mother of six, and stabbed her to death.
Israeli media have since quoted witnesses saying she was stabbed at the entrance to the house as she painted the doorframe. None of her children was hurt.
'Concerned and perplexed'
Hours later on Monday, a new knife attack on a street in another West Bank settlement wounded a 30-year-old pregnant woman.
The 17-year-old Palestinian assailant was shot by security personnel and taken to hospital in severe condition after the attack in Tekoa, south of Jerusalem.
Israeli military chief of staff Gadi Eizenkot told a security conference on Monday that there had been no advance warning for the dozens of stabbings, making it difficult for security forces to counter them, local media reported.
At the same time, he spoke of seeking to avoid a harsh crackdown, such as new restrictions on Palestinian workers, that could push more Palestinians toward violence.
"It would be a bitter mistake to impose curfews and closures," he said. "That would work against Israeli interests."
US ambassador Dan Shapiro on Monday condemned the stabbings as "barbaric acts of terrorism," but also questioned Israel's policies concerning settlements in the West Bank.
The settlements are seen as major stumbling blocks toward peace efforts since they are built on land the Palestinians view as part of their future state.
"We are concerned and perplexed by Israel's strategy on settlements," Shapiro told the security conference in Tel Aviv.
"This government and previous Israeli governments have repeatedly expressed support for a negotiated settlement that would involve mutual recognition and separation.
"Yet separation will become more and more difficult" if Israel continues to expand settlements, he said.