Legendary knight's weapon, an item for auction (8)
I believe the answer is:
lancelot
'legendary knight's' is the definition.
(I've seen this before)
'weapon an item for auction' is the wordplay.
'weapon' becomes 'lance' (lance is a kind of weapon).
'an item for auction' becomes 'lot' (I've seen this before).
'lance'+'lot'='LANCELOT'
(Other definitions for lancelot that I've seen before include "One of King Arthur's knights, lover of Guinevere" , "Most famous of King Arthur's knights, lover of Guinevere" , "A Knight of the Round Table, lover of Guinevere (8)." , "Round Table knight who loved Guinevere" , "Round Table member" .)