First, watch this:
I saw that on Yahoo last night and thought it would be kinda fun to try to figure out how it was done. Here’s my guess. So, first of all, it seems that there are 5 toothpicks, broken in half (but not completely in half). The wood has been compressed due to the bending of the toothpick. Dropping the water on the toothpicks causes the wood fibers to expand as it takes up the moisture. Soon the bent toothpicks are pressing against their neighbors, which pushes them outward forming the star. Seem right?