My question is Which island has the most living volcanos on earth, is it malaysia or indonasia?

Neither, it would be Iceland, or have you missed all of the recent news ;)

First, neither Indonesia nor Malaysia are islands - they are countries. Malaysia is partly on the Asian continent, and is also part on the island of Borneo. And Indonesia is a series of islands (Java, Sumtara, etc). Assuming you meant to ask "which country has the most active volcanos," it would be Indonesia, with about 120. The island of Sumatra in Indonesia alone has 35 active violcanoes - which is more than Iceland. See: Volcanoes of Indonesia - John Seach Malaysia has only one volcano.