Update: Behavior has changed in 1.7.0_06: See this article: Changes to String internal representation made in Java 1.7.0_06 at java-performance.info.
As pointed out by @finnw there is indeed kind of a memory leak lurking around when using String.substring. The reason is that String.substring only returns a view of a portion of the given string, i.e., the underlying string is still kept in memory.
To force the creation of a new string, unrelated to the source, you'll have to use the new keyword. I.e., you'll have to do for instance
String[] parts = orig.split(";");
//String mySubstring = parts[i]; // keeps orig from being GC'd
String mySubstring = new String(parts[i]); // creates a new string.
or, perhaps more direct
String mySubstring = new String(orig.split(";")[i]);
I must say that this behavior seems "unnecessary" to me. It should be solvable using weak references or some other technique. (Especially considering that String is already a special class, part of the Java language specification.)