Cut diamonds from Slough (5)
I believe the answer is:
slice
'cut diamonds from slough' is the definition.
'slice' can be an answer for 'cut' (slicing is a kind of cutting). I'm not certain of the 'diamonds from slough' bit.
'cut diamonds' is the wordplay.
'cut' becomes 'sl' (I can't justify this - if you can you should believe this answer much more).
'diamonds' becomes 'ice' (slang term for diamonds).
'sl'+'ice'='SLICE'
Can you help me to learn more?
(Other definitions for slice that I've seen before include "Portion of pizza" , "Cut into portions" , "Piece cut from a larger portion" , "Thin flat piece" , "shot in golf that goes astray" .)