Something that is "a lot of bad," full of bad, wackness, sucks, lame, horrible, or just generally being bad (bad meaning bad, not bad meaning good).
A term coined in Azusa, CA in the late 1980's by Jon Barcarse and used extensively, and probably exclusively, in the dance groups Legion of Zoom and Creativity.
Variations can also be used. Alottafast, meaning not very fast.
Person1: "Those rims on that MR2 are wack!"
Person2: "Yeah, definitely alottabad dude."
Person1: "Did the DJ's record just skip?"
Person2: "Yeah, alottabad dude."
Person1: "Your girlfriend's annoying."
Person2: "I know. She's alottabad dude."