Whisky is, in its most basic sense, a spirit that is distilled from grain. Sometimes the grain has been malted, sometimes not. It is aged, often for long periods of time, in wooden barrels (usually oak). This barrel-aging smoothes the rough palate of the raw spirit and adds aromatic and flavoring nuances along and the base amber hue, all of which set whiskies apart from white grain spirits such as Vodka, Gin and Aquavit, which are distilled closer to neutrality in taste, and then generally not aged in wood.

The basis of Scotch whisky is the heather-flavored ales made from barley malt that the Picts and their prehistoric ancestors brewed. Archeologists have found evidence of such brewing dating back to at least 2000 B.C. This ale (which is still produced today by at least one Scottish microbrewer) was low in alcohol and not very stable.

Starting in the ninth century, Irish monks arrived in Scotland to Christianize their Celtic brethren. Along with the Word of the Lord they brought the first primitive stills, which they had picked up during their proselytizing visits to mainland Europe during the Dark Ages. The local Picts soon found that they could create a stable alcoholic beverage by distilling their heather ale. Simple stills came to be found in most rural homesteads, and homemade whisky became an integral part of Gaelic culture.

As long as Scottish kings ruled the country from Edinburgh the status quo of whisky as just another farm product was more or less maintained. But the Act of Union in 1707 that combined England, Wales, and Scotland into the United Kingdom altered the Scotch whisky scene forever. The London government soon levied excise taxes on Scottish-made whisky (while at the same time cutting the taxes on English gin). The result was a predictable boom in illicit distilling. In 1790s Edinburgh it was estimated that over 400 illegal stills competed with just eight licensed distilleries. A number of present-day Scottish distilleries, particularly in the Highlands, have their origins in such illicit operations.

source: tastings

The Scots most likely learned about distilling from the Irish (though they are loath to admit it). The Irish in turn learned about it, according to the Irish at least, from missionary monks who arrived in Ireland in the seventh century. The actual details are a bit sketchy for the next 700 years or so, but it does seem reasonable to believe that monks in the various monasteries were distilling aqua vitae (“water of life”), primarily for making medical compounds. These first distillates were probably grape or fruit brandy rather than grain spirit. Barley-based whiskey (the word derives from uisce beatha the Gaelic interpretation of aqua vitae) first appears in the historical record in the mid-1500s when the Tudor kings began to consolidate English control in Ireland. Queen Elizabeth I was said to be fond of it and had casks shipped to London on a regular basis.

The imposition of an excise tax in 1661 had the same effect as it did in Scotland, with the immediate commencement of the production of poteen (the Irish version of moonshine). This did not, however, slow down the growth of the distilling industry, and by the end of the 18th century there were over 2,000 stills in operation around the country.

Under British rule Ireland was export oriented and, along with grains and assorted foodstuffs, Irish distillers produced large quantities of pot-distilled whiskey for export into the expanding British Empire. Irish whiskey outsold Scotch whisky in most markets because it was lighter in body. It is said that in the late 19th century over 400 brands of Irish whiskey were being exported and sold in the United States.

This happy state of affairs for Irish distillers lasted into the early 20th century when the market began to change. The Irish distillers, pot still users to a man, were slow to respond to the rise of blended Scotch whisky with its column-distilled, smooth grain whisky component. When National Prohibition in the United States closed off Irish whiskys largest export market, many of the smaller distilleries closed. The remaining distilleries then failed to adequately anticipate the coming of Repeal (unlike the Scotch distillers) and were caught short without adequate stocks when it came. The Great Depression, trade embargoes between the newly independent Irish Republic and the United Kingdom, and World War II caused further havoc among the distillers.

In 1966 the three remaining distilling companies in the Republic of Ireland—Powers, Jameson, and Cork Distilleries—merged into a single company, Irish Distillers Company (IDC). In 1972, Bushmills, the last distillery in Northern Ireland, joined IDC. In 1975 IDC opened a new mammoth distillery at Midleton, near Cork, and all of the other distilleries in the Republic were closed down with the production of their brands being transferred to Midleton. For a 14-year period the Midleton plant and Bushmills in Northern Ireland were the only distilleries in the country.

This sad state of affairs ended in 1989 when a potato-peel ethanol plant in Dundalk was converted into a whiskey distillery. The new Cooley Distillery began to produce malt and grain whiskeys, with the first three-year-old bottlings being released in 1992.
Irish whiskeys, both blended and malt, are usually triple distilled through both column and pot stills, although there are a few exclusively pot-distilled brands. Irish Pure Pot Still Whiskey is generally labeled as such. Otherwise, Irish whiskeys are a mix of pot and column-distilled whiskeys. Irish Malt Whiskey is likewise so designated. Standard Irish Whiskey is a blend of malt and grain whiskies.

Source: Tastings.com

Scotch Whisky is whisky, which has been distilled and matured in Scotland. Irish Whiskey means whiskey distilled and matured in Ireland. Whisky is distilled in Scotland from malted barley in Pot Stills and from malted and unmalted barley or other cereals in Patent Stills. The well-known brands of Scotch Whisky are blends of a number of Pot Still and Patent Still whiskies. Irish Whiskey distillers tend to favour three distillations rather than two, as is general in Scotland in the case of Pot Still whiskies and the range of cereals used is wider.

As regards Bourbon Whiskey, the United States Regulations provide:

1. that Bourbon Whiskey must be produced from a mash of not less than 51% corn grain;
2. that the word ‘Bourbon’ shall not be used to describe any whiskey or whiskey-based distilled spirits not produced in the United States.

Rye Whiskey is produced both in the United States and Canada but the name has no geographical significance. In the United States, Rye Whiskey by definition must be produced from a grain mash of which not less than 51% is rye grain. In Canada, there is no similar restriction. The relevant Canadian Regulation states: ‘Canadian Whisky (Canadian Rye Whisky, Rye Whisky) shall be whisky distilled in Canada and shall possess the aroma, taste and character generally attributed to Canadian Whisky.’
Canadian Whisky is in fact often referred to simply as Rye Whisky or Rye.

Alcohol, malted or not, made from grain which is produced in Scotland is called WHISKY, while it is called WHISKEY if it is produced in USA or Ireland. American whiskey is called Bourbon and is made from grain. Bourbon is at least 51 per cent corn or maize. Scotch whisky is generally double distilled, while Irish whiskey is generally distilled three times. Wheat whisky is the rarest whisky. Rye whiskies are mostly popular within the US. Scotch whisky is whisky that has been distilled and matured in Scotland for at least three hours in oak casks.