It's limited and can't be found in the outskirts of Sydney (6)
I believe the answer is:
scanty
'it's limited' is the definition.
(thesaurus)
'can't be found in the outskirts of sydney' is the wordplay.
'be found in' indicates putting letters inside.
'the outskirts of' says to hollow out the word (remove centre letters) (letters on the edges or outskirts are used).
'sydney' with its centre removed is 'sy'.
'cant' placed inside 'sy' is 'SCANTY'.
'and' acts as a link.
(Other definitions for scanty that I've seen before include "Spare" , "(Of clothing) barely adequate" , "Insufficient in quantity" , "Lacking in amplitude or quantity" , "(Of clothing) skimpy" .)