Foul group seizes lithium (7)
I believe the answer is:
squalid
'foul' is the definition.
(both can mean disgusting)
'group seizes lithium' is the wordplay.
'group' becomes 'squad'.
'seizes' is an insertion indicator.
'lithium' becomes 'Li' (Li is the chemical symbol for lithium).
'squad' enclosing 'li' is 'SQUALID'.
(Other definitions for squalid that I've seen before include "Foul" , "Seamy, sleazy" , "Slum-like" , "Extremely dirty" , "Wretched, filthy" .)