Yes, chancel is a Scrabble word!
...and is worth 14 points in Scrabble, and 17 points in Words with Friends
chancel
Noun
1. Area around the altar of a church for the clergy and choir; often enclosed by a lattice or railing
What Scrabble words can I make with the letters in chancel?
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Words that can be created with an extra letter added to chancel:
S:chancels