Greek character embraced by female creature (7)
I believe the answer is:
echidna
'creature' is the definition.
(echidna is a kind of creature)
'greek character embraced by female' is the wordplay.
'greek character' becomes 'chi' (letter from the Greek alphabet).
'embraced' is an insertion indicator.
'by female' becomes 'edna' (I can't justify this - if you can you should believe this answer much more).
'chi' placed into 'edna' is 'ECHIDNA'.
(Other definitions for echidna that I've seen before include "Spiny egg-laying Australian mammal" , "Oz native" , "Spiny creature" , "Australian creature" , "Little animal" .)