The Collaborative International Dictionary of English v.0.48:

Smithy \Smith"y\ (-[y^]), n. [AS. smi[eth][eth]e, fr. smi[eth];
   akin to D. smidse, smids, OHG. smitta, G. schmiede, Icel.
   smi[eth]ja. See Smith, n.]
   The workshop of a smith, esp. a blacksmith; a smithery; a
   stithy. [Written also smiddy.]
   [1913 Webster]

         Under a spreading chestnut tree
         The village smithy stands.               --Longfellow.
   [1913 Webster]

WordNet (r) 3.0 (2006):

smithy
    n 1: a workplace where metal is worked by heating and hammering
         [syn: forge, smithy]