Sinister force existing to the North where the monster lurks (8)
I believe the answer is:
evilness
'existing to the north where the monster lurks' is the definition.
I can't judge whether this definition defines the answer.
'sinister force' is the wordplay.
'sinister' becomes 'evil' (similar in meaning).
'force' becomes 'ness' (I can't explain this - if you can you should believe this answer much more).
'evil'+'ness'='EVILNESS'
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