People, say, to be kept in denial (8)
I believe the answer is:
negation
'denial' is the definition.
(negation is a kind of denial)
'people say to be kept in' is the wordplay.
'people' becomes 'nation'.
'say' becomes 'eg'.
'to be kept in' is an insertion indicator.
'nation' going around 'eg' is 'NEGATION'.
(Other definitions for negation that I've seen before include "Contradiction" , "Denial of something's existence" , "Making denial" , "disagreement" , "Refutation by Antigone" .)