Headband: ornate relic exhibited in court (7)
I believe the answer is:
circlet
'headband' is the definition.
(ornamental item worn on the head)
'ornate relic exhibited in court' is the wordplay.
'ornate' indicates an anagram (an unusual or complex form of the letters).
'exhibited in' means one lot of letters goes inside another.
'court' becomes 'ct' (abbreviation used in road names).
'relic' anagrammed gives 'ircle'.
'ircle' placed within 'ct' is 'CIRCLET'.
(Other definitions for circlet that I've seen before include "Ornamental headband" , "Diadem" , "Little hoop" , "Metal band" , "Small round shape" .)