This comes as the Israeli military has been using deadly force against Palestinians protesting the U.S. embassy move to Jerusalem along the Gaza-Israel border.
Leila died at the hospital on Tuesday morning and her funeral was held later that day, which marked the day of "Nakba" that commemorates the more than 700,000 Palestinians who were expelled from their lands by Israeli forces back in 1948.
Human rights group Al Mezan said it is currently investigating her death.
According to The Independent, it remains unclear how near the infant was to the protest area. Some reports suggest she was in a tent away from the security fence when a tear gas canister was dropped via a drone. Meanwhile, her family told the media her uncle had taken her towards the protest area in search of her mother.
Speaking to the Associated Press, a doctor in Gaza suggested Leila may have suffered a pre-existing medical condition that contributed to her death.
The Gaza protests came in response to the inauguration of the first U.S. embassy in Jerusalem on Monday.
"We welcome you officially, and for the first time, to the embassy of the United States here in Jerusalem, the capital of Israel," Ivanka Trump, daughter of the U.S. president, said at the inauguration.
President Donald Trump had announced the controversial decision to relocate the U.S. embassy in Israel to Jerusalem back in December, breaking with decades of established American foreign policy.