A once mysterious island area in Pacific region (7)
I believe the answer is:
oceania
'pacific region' is the definition.
(region in the Pacific Ocean)
'a once mysterious island area' is the wordplay.
'mysterious' is an anagram indicator.
'island' becomes 'i' (geographical abbreviation).
'area' becomes 'a' (maths abbreviation).
'a'+'once'='aonce'
'aonce' anagrammed gives 'ocean'.
'ocean'+'i'+'a'='OCEANIA'
'in' acts as a link.
(Other definitions for oceania that I've seen before include "Pacific Ocean area" , "Large South Pacific region" , "remote area" , "Pacific island region" , "Orwellian superstate" .)