Israel said its security forces in the Gaza Strip had received from the Red Cross the remains of a captive returned by Hamas on Tuesday as part of a US-brokered ceasefire deal.
The terms of the truce, in effect since October 10, require the return of all hostages living and dead.
"Israel has received, via the Red Cross, the coffin of a fallen hostage that was handed over to an [Israeli miitary] and Shin Bet force inside the Gaza Strip," a statement from the prime minister's office said Tuesday.
In a later statement, the military said the body had been brought into Israel and was being transferred to a forensic medical centre for identification.
Earlier, Hamas's armed wing, the Ezzedine Al-Qassam Brigades, said it would hand over the remains of another hostage in accordance with the ceasefire terms.
The group said the body had been recovered in "the Shujaiya neighbourhood east of Gaza City during ongoing search and excavation operations inside the yellow line," referring to the boundary marking Israeli military positions within Gaza.
If the identity is confirmed, this would be the 21st dead hostage handed over by Hamas since the ceasefire took effect.
At the start of the truce, Hamas held 48 hostages in Gaza -- 20 alive and 28 deceased.
The militants have since released all surviving captives.
Of the 20 deceased hostages to have previously been repatriated 18 were Israelis, one was a Thai national and another one Nepali.
In a separate statement, Hamas spokesman Hazem Qassem said the group was working on "completing the process of handing over the bodies of the Israeli captives despite the difficulties and obstacles".
"We are working to complete the entire exchange process as soon as possible," he added.
Israel has accused Hamas of dragging its feet in returning the bodies of deceased hostages, while the Palestinian group says the process is slow because many are buried beneath Gaza's rubble.
The group has repeatedly called on mediators and the Red Cross to provide it with the necessary equipment and personnel to recover the bodies.