I received a staff from a quest. It said that when equipped, my character would hold it. So, I clicked it and clicked on use item. But, now it's gone. I can't find it in my inventory or equipment and my character isn't holding it.

As a Wardrobe Hold item, 'Using' it from your inventory places it in your Wardrobe.
To find it
> Go to your Wardrobe
> Scroll down and then click the 'Items' button/tab
> Click the text that says 'Helds'
> Spend 20 minutes clicking the sideways button looking for it (no, just click the sideways button until you find the item- items that you have in your Wardrobe have a white back instead of a grey back)
> Click the item to make it appear on your Avatar (the background of the item should turn from white to green), click it again to remove it if you don't like it.
> Click 'Save Loaded Outfit'

(you can see how items you don't own would look by clicking the little magnifying glass in their image corner, though they won't save)

Thank you!!