Daydream, one entertained by night rider (7)
I believe the answer is:
reverie
'daydream' is the definition.
(I know that daydream can be written as reverie)
'one entertained by night rider' is the wordplay.
'one' becomes 'i' (Roman numeral).
'entertained by' is an insertion indicator (inserted letters are hosted or entertained).
'night rider' becomes 'revere' (Paul Revere rode through the night).
'i' placed inside 'revere' is 'REVERIE'.
(Other definitions for reverie that I've seen before include "I revere being in a state of dreaminess" , "I revere in daydream" , "A day dream; a word used in the first ever 2 dn" , "Wool-gathering" , "daydreaming" .)