Sanction a run in souped-up car, a small one for racing (2-4)
I believe the answer is:
go-kart
'a small one for racing' is the definition.
Although both the answer and definition are singular nouns, I can't see how they can define each other.
'sanction a run in souped-up car' is the wordplay.
'sanction' becomes 'ok' (to OK something is to approve or sanction it).
'a run' becomes 'ar' (I've seen this in other clues**).
'in' is an insertion indicator.
'souped-up car' becomes 'gt' (short for grand tourer, term for a sports car).
'ok'+'ar'='okar'
'okar' placed within 'gt' is 'GO-KART'.
(Other definitions for go-kart that I've seen before include "Miniature racing car with skeleton body" , "Small motor-racing vehicle" , "Small, low racer" , "Small racing vehicle (K, not C)" , "Lightweight racer" .)