Casino built outside Italy's capital city (7)
I believe the answer is:
nicosia
'capital city' is the definition.
(I've seen this before)
'casino built outside italy's' is the wordplay.
'built' indicates an anagram (the same letters can be used to build the answer).
'outside' indicates putting letters inside (some letters go outside others).
'italy' becomes 'i'.
'casino' is an anagram of 'ncosia'.
'ncosia' enclosing 'i' is 'NICOSIA'.
(Other definitions for nicosia that I've seen before include "Mediterranean capital" , "capital city" , "It's capital in Cyprus (7)" , "Casino I find in Cyprus - that's capital" , "Divided Cypriot city" .)