Day on board lagoon working boat (7)
I believe the answer is:
gondola
'boat' is the definition.
(I've seen this before)
'day on board lagoon working' is the wordplay.
'day' becomes 'd'.
'on board' is an insertion indicator.
'working' indicates anagramming the letters.
'lagoon' is an anagram of 'gonola'.
'd' put into 'gonola' is 'GONDOLA'.
(Other definitions for gondola that I've seen before include "Boats on the canals of Venice" , "Venetian transport" , "mountain climber" , "Traditionally used on Venetian canals" , "Traditional rowboat of Venice" .)