Closed loop testing means to use outputs from a system to use it as inputs again. Normally, there is a controller system and a plant system. The output from the plant can be fed back as an input for the controller (normally from one sample back, e.g. realized with a memory block in a Simulink model) or through TPT to enable modifications.
Within TPT you have several options to test such closed loop systems.
Either you are implementing the closed loop in your system directly,
you are using TPT to simulate the plant directly in your testcases or via function calls of the plant implementation or
you are using the FUSION-platform including two nodes (controller-node and plant-node) and map the corresponding outputs/inputs to each other.
For the solution with the FUSION-platform you can find two different examples within TPT under Help-Examples: In Example 05 you can find also the corresponding Simulink model as closed loop system.