Decline of wit, lively and amusing (8)
I believe the answer is:
twilight
'decline' is the definition.
(I know that twilight is a type of decline)
'wit lively and amusing' is the wordplay.
'lively' is an anagram indicator (letters get livened up or moved around).
'and' means one lot of letters go next to another.
'amusing' becomes 'light' (I've seen this before).
'wit' is an anagram of 'twi'.
'twi'+'light'='TWILIGHT'
'of' acts as a link.
(Other definitions for twilight that I've seen before include "Evening glow" , "when it gets dark" , "Illumination at dusk" , "Declining stage" , "Vampire book" .)