Are there any open source or commercial tools available that allow for text fragment indexing of database contents and can be queried from Java?
Background of the questi
If your table is MyISAM, you can use MySQL's full text search capabilites: http://dev.mysql.com/doc/refman/5.0/en/fulltext-search.html
If not, the "industry standard" is http://www.sphinxsearch.com/
Some ideas on what to do if you are using InnoDB: http://www.mysqlperformanceblog.com/2009/09/10/what-to-do-with-mysql-full-text-search-while-migrating-to-innodb/
Also, a good presentation that introduces Sphinx and explains architecture+usage http://www.scribd.com/doc/2670976/Sphinx-High-Performance-Full-Text-Search-for-MySQL-Presentation
Update
Having read your clarification to the question -- Sphinx can do substring matches. You need to set "enable-star" and create an infix index with the appropriate min_infix_length (1 will give you all possible substrings, but obviously the higher the set it, the smaller your index will be, and the faster your searches). See http://sphinxsearch.com/docs/current.html for details.