Good one awfully oppressed by dingy prison (7)
I believe the answer is:
dungeon
'prison' is the definition.
(a dungeon is a prison cell)
'good one awfully oppressed by dingy' is the wordplay.
'good' becomes 'g' (abbreviation).
'awfully' is an anagram indicator.
'oppressed by' is an insertion indicator (inserted letters are contained or oppressed).
'dingy' becomes 'dun' (both can mean dark or dull in colour).
'g'+'one'='gone'
'gone' is an anagram of 'ngeo'.
'ngeo' placed into 'dun' is 'DUNGEON'.
(Other definitions for dungeon that I've seen before include "Keep" , "Unpleasant cell" , "Dark underground cell for prisoners" , "prison the result" , "Place of confinement underground" .)