Leave out distinguished medal, Italian (4)
I believe the answer is:
omit
'leave out' is the definition.
(I know that leave out can be written as omit)
'distinguished medal italian' is the wordplay.
'distinguished medal' becomes 'OM' (Order of Merit award).
'italian' becomes 'it' (abbreviation for Italian).
'om'+'it'='OMIT'
(Other definitions for omit that I've seen before include "Exclude; forget to include" , "Disregard" , "Leave out or undone" , "Neglect to include" , "Exclude; veto" .)