Caterpillar seen in popular valley (5)
I believe the answer is:
larva
'caterpillar' is the definition.
(I've seen this before)
'in popular valley' is the wordplay.
'in' says the answer is hidden in the clue.
'LARVA' can be found hidden inside 'popular valley'.
'seen' is the link.
(Other definitions for larva that I've seen before include "Caterpillar perhaps" , "Maggots" , "Grub of e.g. beetle" , "Juvenile form of insect" , "Early stage of creature" .)