Morally improved duke earlier, becoming exalted (7)

I believe the answer is:

deified

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'exalted' is the definition.
(I've seen this before)

I cannot understand how the rest of the clue works.

(Other definitions for deified that I've seen before include "Made into a god" , "Edified, being treated like a god" , "Being raised" , "Worshipped as a god" , "exalted" .)

I've seen this clue in The Everyman puzzle in The Observer.

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