[Ed. - This post may contain spoilers for numerous movies, among them Identity, The Others, Usual Suspects, Lone Star, Momento, Frailty and films by M. Night Shyamalan.]
In the final act of the 2003 thriller Identity all the characters, dead and alive, are revealed to be split personalities inside the brain of a serial killer. You would've had to have been telepathic to have seen this coming and the new information forces you to radically and quickly rethink everything you have seen up to that point.
That's a twist.
I have a friend who ruined The Sixth Sense for a theater-full of people when he slapped his forehead halfway through and loudly exclaimed, "Oh my gosh, I think he's dead!"
That's a twist, too. The film led you to believe you were solving one mystery, while another, deeper one lurked right in front of you. The same could be said of The Others, Lone Star and The Village.
But I'm not sure whether it's fair to claim that Usual Suspects really has a twist. You know that the mystery is the identity of Keyser Soze. You have only yourself to blame if you didn't figure out the answer. The same is true of Psycho. The question is always the killer's identity. The fact that Albert Hitchcock threw up a few red herrings doesn't change that. Ditto films like Momento, Scream and Seven.
I probably wouldn't think about this subject at all if, years ago, I hadn't seen Frailty, which is one of those movies that, once seen, can never be unseen.
Could I have guessed that Adam and his dad would turn out to be the good guys, that the slaughtered people were actually demons, that the movie's hero would grow up to be the God's Hand serial killer, and that Adam had killed his brother and taken his name so he could lure a cold-blooded murderer out to the Rose Garden at the behest of God? I doubt it. Even if I wasn't permanently scarred by the gut-churning moment when Adam takes up his dad's work.
Humans have a prejudice for the real. Frailty uses that. You think you're watching a gritty thriller about a boy with a killer for a father, when in fact you're watching a supernatural horror movie about a man with a demon for a son. Somebody get me the remote, I need to hit the rewind button. Just as soon as I stop shaking.
What separates a clever ending from a true twist? The former surprises with the answer, while the latter, like Frailty, changes the question.