Grace ill, badly suffering from a reaction (8)
I believe the answer is:
allergic
'suffering from a reaction' is the definition.
(reacting due to an allergy)
'grace ill badly' is the wordplay.
'badly' indicates an anagram.
'grace'+'ill'='graceill'
'graceill' anagrammed gives 'ALLERGIC'.
(Other definitions for allergic that I've seen before include "Hypersensitive (to certain substances)" , "Having an adverse reaction (to something)" , "Hypersensitive to something" , "Having unfavourable reaction to, say pollen" , "Physically intolerant" .)