Dampen strip I'd treated to absorb iodine (8)
I believe the answer is:
dispirit
'dampen' is the definition.
(thesaurus)
'strip i'd treated to absorb iodine' is the wordplay.
'treated' is an anagram indicator.
'to absorb' indicates putting letters inside.
'iodine' becomes 'i' (I is the chemical symbol for iodine).
'strip'+'id'='stripid'
'stripid' is an anagram of 'dspirit'.
'dspirit' placed around 'i' is 'DISPIRIT'.
(Other definitions for dispirit that I've seen before include "Make hopeless" , "Cause to feel low or depressed" , "Weigh" , "Cause to lose hope" , "Deject, dishearten" .)