Studio exposed by ultimate lie, regrettably (7)
I believe the answer is:
atelier
'studio' is the definition.
(atelier is a kind of studio)
'exposed by ultimate lie regrettably' is the wordplay.
'exposed by' indicates the answer is hidden within the clue (I've seen this in other clues).
'ATELIER' can be found hidden inside 'ultimate lie regrettably'.
(Other definitions for atelier that I've seen before include "Designer's workshop" , "room for artist" , "Artist's workshop, studio" , "Artist's studio (French)" , "I relate to workshop used by artist" .)