Clothing: dismay when note found inside (7)
I believe the answer is:
apparel
'clothing' is the definition.
(I know that apparel is a type of clothing)
'dismay when note found inside' is the wordplay.
'dismay when' becomes 'appal' (synonyms. I am not sure about the 'when' bit.).
'note' becomes 're' (as in do-re-mi).
'found inside' means one lot of letters goes inside another.
'appal' enclosing 're' is 'APPAREL'.
Can you help me to learn more?
(Other definitions for apparel that I've seen before include "Raiment" , "Formal word for clothing" , "Clothing, things to wear" , "what's in the press?" , "Real pap (anag) - clothing" .)