Whiskey (or whisky) can be confusing, because it encompasses so many different flavors, and so many different styles. Historically, there are four general categories of whiskey, based on the regions where they originated. It is important to note that of late, more and more countries have started producing whiskey, and more craft distilleries are popping up who create whiskeys not necessarily true to they style of their home country. What is listed below is based on style, not on actual country of origin. While three of the four styles are actually internationally protected designations, and the U.S. has a couple within it, it is possible for a "Scotch" style whisky to come from the U.S., although it won't be called Scotch.
What is a mashbill? Much of whiskey's flavor comes from the barrel it ages in, as you probably know. But the base ingredients do tend to show some characteristics throughout. Mashbill is a term for the recipe for original ingredients used. In general, whiskey is made from some combination of four grains: barley, wheat, rye, and corn. Two of these grains, barley and corn, undergo treatment before being used. Barley is malted, or partially germinated, before being fermented, to release enzymes which break down starches into fermentable sugars. Corn is cooked in order to start releasing fermentable sugars. The main differentiation for each of the regions where a style originated is the mashbill. It is important to note that almost all whiskeys are a blend of more than one grain. When we say a "rye" whiskey, that does not mean the mashbill is 100% rye. Depending on the country, it means a large portion, probably a majority, of the mashbill is rye. In fact, all whiskeys have at least some malt (malted barley) in the mashbill, as the enzymes produced by the malting process are vital to saccharification, or converting starch to sugar, in not just barley, but all of the grains used in whiskey production.
Irish Whiskey
Ireland is actually thought to be the birth place of whiskey. Whiskey was then thought to be brought to Scotland by monks. Irish whiskey (spelled with an 'e') is generally made with a mashbill of both malted and unmalted barley. The unmalted barley contributes a spice and bite which is not present in most malt whiskeys.
Scotch Whisky
The Scotch spell whisky without an "e." Scotch whiskey can vary tremendously in style, but it is usually malt-heavy, using only malted, and no un-malted barley. It is traditonally aged in used sherry barrels, giving an extra sweet note to the whisky. Malt for Scotch is traditionally kilned (malt must be heated in a kiln in order to halt germination once all necessary enzymes have been released), using peat-fired kilns. This imparts "peat reak," a unique combination of smells and flavors. Peat imparts smokey, earthy, pungent, and even slightly salty flavors and aromas into a whisky. The peat is more prominent in some whiskys than others.
Different styles of Scotch-malt vs. grain, "single malt" vs. vatted, etc.
Even within the Scotch family there are distinctions. People often get confused by these and think "single malt" is in contrast to "double malt" or something similar. The easiest way to understand a Scotch label is to split the two descriptors apart.
Malt or grain refers to the mashbill. Malt whisky indicates a whisky made entirely from malted barley. Grain whisky referes to a whisky made from a mixture of malt and other grains.
"Single" Malt or Single Grain refers to the whisky being made at a single distillery. Most Scotch distillers own multiple distilleries, and they transfer whisky between them all of the time, or even buy from other producers to create their blends. Blended, vatted, or simply "malt" or "grain" whisky is a whisky made by blending barrels from different distilleries.
There is a common misconception that "single malt" is always better than other Scotch whiskys. This is simply not true. In fact, they are often interesting and bold, highlighting the distinct flavors imparted by different climates and different production methods. But blending allows a distiller or bottler to create a consistent, quality product which has exactly the flavor profile they are looking for. The whiskys are different, but there are some very good, and very pricey, blended whiskys out there.
American Whiskey
American Whiskey (with an 'e'), generally refers to Bourbon and Tennessee whiskey (speaking in terms of style). These whiskeys are at least 51% corn, giving them some sweeter flavors than many other whiskeys. They are also aged in new, American oak barrels. This leads to them having very distinct wood-derived flavors, rather than simply mellowing or absorbing other sweet spirit flavors from their barrels. Bourbon does not have to come from Bourbon County, or even from Kentucky. Tennessee Whiskey, on the other hand, must come from that state, and must undergo charcoal mellowing after aging. It is important here to note that the U.S. is undergoing a bit of a craft spirit surge right now, and many American Whiskeys are actually crafted to mimic other styles. They will be labeled as American Whiskey, but be modeled after Scotch, Irish, or Canadian styles, or present a whole new idea of what whiskey can be.
Canadian Whisky
Canadians follow the Scotch spelling, but the style is quite different. Canadian whisky is also heavy on corn in the mash, but also generally has rye as well. Canadian whiskys can legally be labeled "rye whisky" even if there is no rye in them, as the term is legally synonymous in Canada with "Canadian Whisky." The corn provides the same sweetness that it does to American whiskeys, but the rye adds a slightly lemony, spicy, flavor to they whisky, as well as a dry, slightly harsh finish. Also, Canadian whisky producers often ferment and distill each grain separately, then blend the spirit either right before, or even after, aging. This allows each grain to develop its own unique characteristics, and allows the distiller to create a blend of those characteristics.
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