Costume Peter Lorre conclusively wears to horrify (7)
I believe the answer is:
apparel
'costume' is the definition.
(I've seen this before)
'peter lorre conclusively wears to horrify' is the wordplay.
'conclusively' says to take the final letters (the letter that concludes the word).
'wears' is an insertion indicator.
'to horrify' becomes 'appal' ('appal' can be a synonym of 'horrify').
The last letters of 'peter lorre' are 're'.
're' inserted inside 'appal' is 'APPAREL'.
(Other definitions for apparel that I've seen before include "Fancy gear" , "whatever people have on" , "what's in the press?" , "Garb, clothes" , "kit" .)