Bird, small, up in hole (6)
I believe the answer is:
peewit
'bird' is the definition.
(peewit is a kind of bird)
'small up in hole' is the wordplay.
'small' becomes 'wee' (Scottish term for small).
'up' says the letters should be written backwards (in down clue: letters go upwards).
'in' is an insertion indicator.
'hole' becomes 'pit' (pit is a kind of hole).
'wee' back-to-front is 'eew'.
'eew' inserted within 'pit' is 'PEEWIT'.
(Other definitions for peewit that I've seen before include "Kind of plover; let it weep" , "Does it weep, this bird?" , "Flighty type" , "Lapwing turned up in a wee pit" , "Lapwing - ie wept (anag)" .)