The most common and most likely answer to this crossword clue is the 6 plus 2 plus 7 letter word STRAIT OF MESSINA
I've seen this crossword clue in The Sunday Telegraph
S
T
R
A
I
T
O
F
M
E
S
S
I
N
A
More clues leading to the result STRAIT OF MESSINA
Buddy explains!
The straight part
We know that "waters off Italy" is the straight/definition part of the clue. The straight part is often a synonym or definition, in this case waters off italy = strait of messina.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.