In a pair of quantum particles [1], when one is spinning-up, other is spinning down even when they are separated. Therefore it is possible to find out about the state of one by looking at the other.
Many (most?) interpretations of quantum mechanics do not involve a "collapse" of the wavefunction. The Copenhagen interpretation, which is the oldest and better known, does, but the many-worlds interpretation (which I dislike), which is favoured by many working in cosmology and quantum gravity, does not involve a collapse of the wavefunction.
[1] http://en.wikipedia.org/wiki/Quantum_entanglement#Concept