How to check if a String contains another String in a case insensitive manner in Java?

Yes, contains is case sensitive. You can use java.util.regex.Pattern with the CASE_INSENSITIVE flag for case insensitive matching:

Pattern.compile(Pattern.quote(wantedStr), Pattern.CASE_INSENSITIVE).matcher(source).find();

EDIT: If s2 contains regex special characters (of which there are many) it's important to quote it first. I've corrected my answer since it is the first one people will see, but vote up Matt Quail's since he pointed this out.

One problem with the answer by Dave L. is when s2 contains regex markup such as \d, etc.

You want to call Pattern.quote() on s2:

Pattern.compile(Pattern.quote(s2), Pattern.CASE_INSENSITIVE).matcher(s1).find();

You can use

org.apache.commons.lang3.StringUtils.containsIgnoreCase("AbBaCca", "bac");

The Apache Commons library is very useful for this sort of thing. And this particular one may be better than regular expressions as regex is always expensive in terms of performance.