Surrounded by dams, it flourishes (6)
I believe the answer is:
amidst
'surrounded by' is the definition.
(amidst means within or surrounded by)
'dams it flourishes' is the wordplay.
'flourishes' indicates anagramming the letters (I've seen 'flourishing' mean this (letters grow or flourish differently)).
'dams'+'it'='damsit'
'damsit' with letters rearranged gives 'AMIDST'.
(Other definitions for amidst that I've seen before include "Beset" , "In the thick of" , "Among" , "Embraced by" , "In the middle of the morning I would have a piece of crust" .)