Environment somewhat protected by Panama? (7)
I believe the answer is:
habitat
'environment' is the definition.
(habitat is a kind of environment)
'somewhat protected by panama?' is the wordplay.
'somewhat' becomes 'abit' (a bit).
'protected by' indicates putting letters inside.
'panama?' becomes 'hat' (panama is a kind of hat).
'abit' put inside 'hat' is 'HABITAT'.
(Other definitions for habitat that I've seen before include "Environment in which groups normally live" , "home, naturally" , "Home ground of an animal" , "Bath at 1? (anag)" , "One's normal environment" .)