Atmosphere in the City holding Sri Lankan back (7)
I believe the answer is:
climate
'atmosphere' is the definition.
(I've seen this before)
'city holding sri lankan back' is the wordplay.
'city' becomes 'EC' (postcode for the City of London).
'holding' is an insertion indicator.
'sri lankan' becomes 'Tamil' (Tamil are a Sri Lankan ethnic group).
'back' says the letters should be written backwards.
'ec' placed around 'tamil' is 'etamilc'.
'etamilc' in reverse letter order is 'CLIMATE'.
'in the' is the link.
(Other definitions for climate that I've seen before include "Weather etc" , "National weather conditions" , "General weather conditions in an area" , "Long-term prevalent weather conditions" , "Atmosphere" .)