Is it possible to unroot a device?

This really depends. What phone are you using and how did you root it?

For example: some phones have an easy "one click" root method to root your phone. They often have a reverse easy "one click" unroot method. An example of this is EasyRoot for Droid.

As for doing it via a factory reset, that's not necessarily enough. Factory resets usually (always?) wipe only the user partitions such as /data without touching the system partition, where su and other evidence of rooting is likely to remain. Re-flashing the ROM should be enough though, although some devices have flash counters that may also be checked if you send in your phone for warranty purposes.