'Use needles', fool said (4)
I believe the answer is:
knit
'use needles' is the definition.
(I've seen this before)
'fool said' is the wordplay.
'fool' becomes 'nit' (I've seen this before).
'said' indicates a 'sounds like' (homophone) clue.
'nit' is a homophone of 'KNIT'.
(Other definitions for knit that I've seen before include "Make a woolly" , "Make woollen objects" , "Work with wool and needles" , "Unite closely" , "Tighten (eyebrows) in a frown; unite" .)