Clap kids with no limits set (4)
I believe the answer is:
camp
'set' is the definition.
(I know that camp is a type of set)
'clap kids with no limits' is the wordplay.
'kids' becomes 'imps' (imp is a kind of kid).
'with no' indicates named letters should be taken away.
'limits' becomes 'lips' (both can mean edges).
'clap'+'imps'='clapimps'
'clapimps' with 'lips' taken away is 'CAMP'.
(Other definitions for camp that I've seen before include "Affected - group of tents" , "Where guys are tense" , "David, for instance" , "military depot" , "Area of temporary accommodation" .)