Hanging in a French town (5)
I believe the answer is:
arras
I believe this clue is a double definition.
'hanging' is the first definition.
(arras is a kind of hanging)
'a french town' is the second definition.
(I've seen this before)
'in' acts as a link.
(Other definitions for arras that I've seen before include "Tapestry; WW One battle" , "Polonius met his end behind one" , "Wall hanging of heavy woven fabric" , "Work of art" , "Tapestry wall hanging" .)