Poet hiding key in facial hair (5)
I believe the answer is:
beard
'facial hair' is the definition.
(I've seen this in another clue)
'poet hiding key' is the wordplay.
'poet' becomes 'bard' (bard is a kind of poet).
'hiding' is an insertion indicator.
'key' becomes 'e' (musical key).
'bard' enclosing 'e' is 'BEARD'.
'in' acts as a link.
(Other definitions for beard that I've seen before include "SECOND PART OF 14" , "Vandyke, perhaps" , "Facial growth" , "Goatee, for instance" , "Hair on the chin" .)