Grand time with everybody on board ship (7)
I believe the answer is:
galleon
'ship' is the definition.
(I've seen this before)
'grand time with everybody on board' is the wordplay.
'grand' becomes 'g' ('G' can be a synonym of 'grand').
'time' becomes 'eon' (eon is a kind of time**).
'with' says to put letters next to each other.
'everybody' becomes 'all' (I've seen this before).
'on board' means one lot of letters goes inside another.
'g'+'eon'='geon'
'geon' placed around 'all' is 'GALLEON'.
(Other definitions for galleon that I've seen before include "Large Spanish sailing ship of yore" , "One might sink" , "Trader" , "Spanish treasure ship" , "Ship of the line" .)