Greek woman engaged by high-ranking diplomat (7)
I believe the answer is:
hellene
'greek' is the definition.
(term for an ancient Greek)
'woman engaged by high-ranking diplomat' is the wordplay.
'woman' becomes 'ellen' (woman's name).
'engaged by' is an insertion indicator (I've seen this in other clues).
'high-ranking diplomat' becomes 'HE' (His or Her Excellency, address for an ambassador).
'ellen' put into 'he' is 'HELLENE'.
(Other definitions for hellene that I've seen before include "old Greek" , "Greek girl" .)