Ambassador's immersed in European matter in Greek city (7)
I believe the answer is:
ephesus
'greek city' is the definition.
'ephesus' can be an answer for 'city' (I have seen 'ancient city' mean 'ephesus' so perhaps 'city' could also mean 'ephesus'). I am not certain of the 'greek' bit.
'ambassador's immersed in european matter' is the wordplay.
'ambassador's' becomes 'HE's' (His or Her Excellency).
'immersed in' means one lot of letters goes inside another.
'european' becomes 'e' (abbreviation e.g. EU).
'matter' becomes 'pus' (liquid matter produced by the body).
'e'+'pus'='epus'
'hes' placed within 'epus' is 'EPHESUS'.
'in' is the link.
Can you help me to learn more?
(Other definitions for ephesus that I've seen before include "site of ancient temple" , "Ancient Med. city" , "Comedy of Errors setting" , "Ancient city on the coast of Asia Minor" , "Ancient port in Turkey" .)