Hamdallah told Ma'an, the Palestinian news agency, a group of soldiers and settlers stopped his car and tried to force him to step out.
He claimed that soldiers and settlers planned to assault him.
Israeli forces said Hamdallah's convoy was driving recklessly on the highway and was endangering traffic.
Army officials argued that members of the convoy assaulted an officer and refused to cooperate with him, Israeli broadcaster Arutz Sheva reported.
Hamdallah is also accused of swearing at one of the officers and calling him a dog.
No one was injured in the incident, Arutz Sheva said.
Notable deaths of 2014 [PHOTOS]
U.S., allies launch airstrikes against Syria