"Old Fruit" competed in the race, in short (7)
I believe the answer is:
currant
'old fruit' is the definition.
'currant' can be an answer for 'fruit' (currant is a kind of fruit). I am not certain of the 'old' bit.
'competed in the race in short' is the wordplay.
'competed' becomes 'ran' (running is a kind of competing).
'in the' means one lot of letters goes inside another.
'race in short' becomes 'curt' (I am not sure about this - if you are sure you should give a lot more credence to this answer).
'ran' placed within 'curt' is 'CURRANT'.
Can you help me to learn more?
(Other definitions for currant that I've seen before include "Edible berry, red or black" , "Small dried seedless grape" , "Small black raisin" , "The berry sounds electric" , "Extirpate" .)