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A former Palestinian militant who renounced violence in favour of "cultural resistance" is in custody after Israel apparently revoked an amnesty deal, in a move seen by his associates as part of a campaign of harassment against a radical West Bank theatre.

Zakaria Zubeidi, a former of leader of the al-Aqsa Martyrs Brigade in the northern West Bank city of Jenin, is being held by Palestinian security forces after being told he would be arrested by Israeli authorities if he did not hand himself in.

"I am in a Palestinian Authority jail in Jenin," he told the Guardian by phone. His account could not be confirmed by either Israeli or Palestinian sources.

Zubeidi, 33, was one of Israel's most wanted militants during the Palestinian intifada in the early years of the last decade, suspected of making bombs used in suicide attacks. In 2007, he was included in an amnesty offered by the Israeli government to around 200 militants, and handed his weapons over to PA security forces.

He became the director of the Freedom theatre in Jenin, which claims to use art as "a form of resistance to oppression". The Freedom theatre aims to challenge Israel's "violent military occupation" through its productions and workshops, but it has also tackled taboo issues in Palestinian society. According to Zubeidi, "I continued my struggle against occupation through cultural resistance".

He had adhered to the conditions of the amnesty deal and had been given no explanation of why it had been rescinded, he told other media outlets.

The theatre said that Zubeidi's life was in danger following the revocation of the amnesty deal. "The amnesty agreement allowed him to remain safe inside … Jenin, where the Israeli military would not seek to arrest or assassinate him," it said in a statement. Zubeidi had survived "numerous Israeli attempts to assassinate him during the Intifada".

Zubeidi co-founded the Freedom theatre with Juliano Mer Khamis, who was shot dead in Jenin in April. In the past few months there have been repeated raids on the theatre by the Israeli military, and staff have been questioned. No one has been arrested for the murder of Mer Khamis, who had a Jewish mother and an Arab father.

"Over half a year, there has been an enormous amount of harassment of people associated with the theatre," said Jonatan Stanczak, a third co-founder and managing director. "I don't know why they are doing these things. All these events have come in a sequence."