The most common and most likely answer to this crossword clue is the 5 letter word MALTA
I've seen this crossword clue in The Times
M
A
L
T
A
More clues leading to the result MALTA
- Pound making comeback cheers nation
- Mother, fifty, cheers for Republic
- Barley sprouted on a small island
- Liquor on a Mediterranean island
- A little animal taken in island
- I drink ale, primarily
- Month on topless resort somewhere in the Med
- Country that La Marseillaise presents in revolution
- Island whisky’s ace
- Once defiant island area with spirit
Buddy explains!

The straight part
We know that "small island" is the straight/definition part of the clue. The straight part is often a synonym or definition, in this case small island = malta.The cryptic/wordplay part
In cryptic crossword there's often an wordplay/cryptic part as well.This part involves a more complex hint, such as an anagram, homophone, hidden word, etc.
Sadly, We don't have an explanation for this specific crossword clue yet.