Sort of road fragment used in test (7)
I believe the answer is:
orbital
'sort of road' is the definition.
(term for a ring road)
'fragment used in test' is the wordplay.
'fragment' becomes 'bit' (bit is a kind of fragment).
'used in' indicates putting letters inside.
'test' becomes 'oral' (oral is a type of examination).
'bit' inserted within 'oral' is 'ORBITAL'.
(Other definitions for orbital that I've seen before include "Relating to a planet's or a moon's track" , "Descriptive of the M25" , "Revolutionary" , "Going round the world" , "(Of a road) going round a town" .)