Story from pal battling with bear (7)
I believe the answer is:
parable
'story' is the definition.
(I know that parable is a type of story)
'pal battling with bear' is the wordplay.
'battling with' indicates anagramming the letters (I've seen 'battle' mean this (the letters disrupted as if in battle)).
'pal' anagrammed with 'bear' makes 'PARABLE'.
'from' is the link.
(Other definitions for parable that I've seen before include "Leap bar poorly for a biblical story" , "Short moral story" , "Exemplum" , "Moral tale" , "Sower, for one" .)