The Collaborative International Dictionary of English v.0.48:

Untwist \Un*twist"\, v. t. [1st pref. un- + twist.]
   [1913 Webster]
   1. To separate and open, as twisted threads; to turn back, as
      that which is twisted; to untwine.
      [1913 Webster]

            If one of the twines of the twist do untwist,
            The twine that untwisteth, untwisteth the twist.
                                                  --Wallis.
      [1913 Webster]

   2. To untie; to open; to disentangle. --Milton.
      [1913 Webster]

WordNet (r) 3.0 (2006):

untwist
    v 1: cause to become untwisted [ant: distort, twine,
         twist]