A type of road construction. A definition:
to construct or finish (a road) by compacting into a solid mass a layer of small broken stone on a convex well-drained roadbed and using a binder (such as cement or asphalt) for the mass
In my reading, it appears that this is the type of road where layers of gravel are laid, then compacted by heavy rollers over and over. As this happens – and as cars roll over it later – it gets compressed and holds together.
The name comes from the inventor John Loudon McAdam.