Bird, large one in nut tree (7)
I believe the answer is:
pelican
'bird' is the definition.
(pelican is a kind of bird)
'large one in nut tree' is the wordplay.
'large' becomes 'l'.
'one' becomes 'I' (Roman numeral).
'in' means one lot of letters goes inside another.
'nut tree' becomes 'pecan' (pecan is a kind of nut tree).
'l'+'i'='li'
'li' placed within 'pecan' is 'PELICAN'.
(Other definitions for pelican that I've seen before include "Its beak holds more than its belly can" , "Bird with enormous bill" , "Aquatic, billed bird" , "Large water bird" , "In place (anag.)" .)