Nest unknown in lake (5)
I believe the answer is:
eyrie
'nest' is the definition.
(eyrie is a kind of nest)
'unknown in lake' is the wordplay.
'unknown' becomes 'y' (algebra).
'in' means one lot of letters goes inside another.
'lake' becomes 'erie' (Lake Erie is one of the Canadian/US 'Great Lakes').
'y' going inside 'erie' is 'EYRIE'.
(Other definitions for eyrie that I've seen before include "Eagle's lair" , "lofty dwelling" , "highly placed house" , "animal home" , "elevated position" .)