The Collaborative International Dictionary of English v.0.48:

Disband \Dis*band"\ (?; see Dis-), v. t. [imp. & p. p.
   Disbanded; p. pr. & vb. n. Disbanding.] [Pref. dis- +
   band: cf. OF. desbander, F. d['e]bander, to unbind, unbend.
   See Band, and cf. Disbend, Disbind.]
   1. To loose the bands of; to set free; to disunite; to
      scatter; to disperse; to break up the organization of;
      especially, to dismiss from military service; as, to
      disband an army.
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            They disbanded themselves and returned, every man to
            his own dwelling.                     --Knolles.
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   2. To divorce. [Obs.]
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            And therefore . . . she ought to be disbanded.
                                                  --Milton.
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The Collaborative International Dictionary of English v.0.48:

Disband \Dis*band"\, v. i.
   To become separated, broken up, dissolved, or scattered;
   especially, to quit military service by breaking up
   organization.
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         When both rocks and all things shall disband.
                                                  --Herbert.
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         Human society would in a short space disband.
                                                  --Tillotson.
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WordNet (r) 3.0 (2006):

disband
    v 1: cause to break up or cease to function; "the principal
         disbanded the political student organization"
    2: stop functioning or cohering as a unit; "The political wing
       of the party dissolved after much internal fighting" [syn:
       disband, dissolve]