Horse and bear without tail caged by fool (7)
I believe the answer is:
mustang
'horse' is the definition.
(mustang is a kind of horse)
'bear without tail caged by fool' is the wordplay.
'bear' becomes 'stand' (synonyms).
'without tail' means to remove the last letter.
'caged by' is an insertion indicator.
'fool' becomes 'mug' (synonyms).
'stand' with its last letter removed is 'stan'.
'stan' inserted within 'mug' is 'MUSTANG'.
'and' is the link.
(Other definitions for mustang that I've seen before include "creature" , "Ford car, first produced in 1964" , "Wild horse of the West" , "Feral American horse" , "Hardy wild horse of the American western plains" .)