Last semester in Alabama (8)
I believe the answer is:
terminal
'last' is the definition.
('terminal' can be a synonym of 'last')
'semester in alabama' is the wordplay.
'semester' becomes 'term' (I've seen this before).
'alabama' becomes 'al'.
'term'+'in'+'al'='TERMINAL'
(Other definitions for terminal that I've seen before include "Forming an end" , "Passenger building" , "Situated at the end" , "work station" , "Electrical connector" .)