Lounge in northerly inn burst into flames (5,2)
I believe the answer is:
blaze up
'burst into flames' is the definition.
(I've seen this in another clue)
'lounge in northerly inn' is the wordplay.
'lounge' becomes 'laze' (laze can mean to lounge around).
'in' indicates putting letters inside.
'northerly' says the letters should be written backwards (in a down clue, letters go up or 'north').
'inn' becomes 'pub' (both can mean a drinking establishment).
'pub' backwards is 'bup'.
'laze' placed inside 'bup' is 'BLAZE UP'.
(Another definition for blaze up that I've seen is " fired?".)