Loosening in defeat (7)
I believe the answer is:
undoing
I believe this clue is a double definition.
'loosening' is the first definition.
(I know that undoing is a type of loosening)
'defeat' is the second definition.
(thesaurus)
'in' is the link.
(Other definitions for undoing that I've seen before include "(A person's) ruin or downfall" , "Cause of ruin" , "Taking apart" , "Ruin - disaster" .)