Horse around in sarong on vacation (4)
I believe the answer is:
scag
'horse' is the definition.
(synonyms)
'around in sarong on vacation' is the wordplay.
'around' becomes 'ca' (circa).
'in' indicates putting letters inside.
'on vacation' means to remove the middle letters.
'sarong' with its centre removed is 'sg'.
'ca' put inside 'sg' is 'SCAG'.
(Other definitions for scag that I've seen before include "Sugar" , "heroin" .)