Crap, I've misread the question! Yes, they're isolated!
There are no equivalents of jUnit's setUp and tearDown but each method is independent of other methods. If you need setUp, you have to write it yourself - create a small private static void prepareTestData() with all your DML and explicitly call it at the beginning of your test methods.
Actually it might be marked as public - will save you time if you can reference them from other test classes. It's still within a test class so it's unaccessible from regular code and does not count towards Apex storage usage.
There used to work a neat trick that would let you have some kind of "initialization block":
@isTest
private class TestClassName {
private static Acount testAccount;
static {
testAccount = new Account(Name = 'science, baby');
insert testAccount;
}
static testMethod void testMethodName() {
}
static testMethod void testMethodName() {
}
}
This doesn't work anymore :( If you have only 1 test method it should work, but each subsequent one will not see the data crated in this static block.