Cat long ago seen round university (5)
I believe the answer is:
ounce
'cat' is the definition.
(ounce is a kind of cat)
'long ago seen round university' is the wordplay.
'long ago' becomes 'once' (I've seen this before).
'seen round' means one lot of letters goes inside another.
'university' becomes 'u' (abbreviation for university).
'once' going around 'u' is 'OUNCE'.
(Other definitions for ounce that I've seen before include "prowler" , "small portion" , "one of sixteen in a pound" , "little weight" , "Small amount (of old pound)" .)