The procedure follows several similar cases last year in the West Bank, and Palestinians view such births as an act of defiance against Israel's jail policies.
"I am tired and very, very happy," said mother Hana al-Za'anin, her voice weak, hours after delivering baby al-Hassan.
Speaking from a hospital bed in Gaza City, she told Reuters Israel had banned her from visiting her husband since his arrest in 2006, citing unspecified "security reasons."
Most of Gaza's 1.8 million people are barred from entering Israel for the same reason, although it allows some merchants and seriously ill people to enter its territory from Gaza.
Gaza has been run by the Islamist group Hamas since 2007. Israel has enforced a blockade on the territory and has fought a round of bloody battles with the militant party.
Al-Za'anin declined to say how the sperm was conveyed out of prison, but said its journey to a medical lab in Gaza, where two specialists were waiting for it, took around six hours.
Her husband Tamer was arrested in an Israeli army incursion into the northern Gaza town of Beit Hanoun and jailed for 12 years for belonging to the Islamic Jihad militant group.
"Today a hero was born to a hero," the prisoner's 22-year-old brother Tareq, a hairdresser, said with a laugh.
Israel regards 5,000 or so Palestinian prisoners in its jails, many imprisoned for killing civilians, as terrorists.
A WAY OUT
As part of struggling U.S. peace talks revived in July after a three month hiatus, Israel agreed to release 104 long-term prisoners in four stages.
They have been welcomed home joyfully, but many Israelis oppose the releases. In an apparent bid to appease them, the government agreed to expand the construction of Jewish settlements on occupied land.
The insemination of prisoners' wives led to six pregnancies in the occupied West Bank in 2013, as clinics have become more advanced, community awareness has increased and religious clerics are blessing the practice.
"750,000 Palestinians have been arrested by Israel since 1967 - many serve long sentences," said Doctor Salem Abu Khaizaran of the Razan Medical Center in Nablus, a West Bank facility that aided the pregnancies.
"The families suffer, and our services provide a way out."
Palestinians say their prisoners are fighters in a political struggle and deserve more protection under international law.
They are rankled by the Israeli government's decision in 2006 to allow the Israeli assassin of former Prime Minister Yitzhak Rabin to conceive a son through conjugal visits.