Island whisky's ace (5)
I believe the answer is:
malta
'island' is the definition.
(Malta is an example)
'whisky's ace' is the wordplay.
'whisky' becomes 'malt' (malt whisky is a kind of whisky).
'ace' becomes 'a'.
'malt'+'a'='MALTA'
(Other definitions for malta that I've seen before include "Island European country" , "Mediterranean island awarded the George Cross" , "Island member of the European Union" , "A Med. island" , "Mediterranean island state" .)