Principality in the Pyrenees (7)
I believe the answer is:
andorra
'principality in the pyrenees' is the definition.
(I've seen this before)
This is the entire clue.
(Other definitions for andorra that I've seen before include "Small republic between Spain and France" , "Catalan state" , "Land up, perhaps" , "Tiny European nation" , "Independent Pyrenean state" .)