Oily Rag Share definition Flag An 'oily rag' is a cockney slang for a fag, AKA cigarette. You could smoke an 'oily rag', for example. New inforced laws mean I can only smoke my oily rag outside. Oily Rag by Kervik July 1, 2009 0 0 Get merch Get the Oily Rag mug. Buy Now — $32.95 See more merch