This achievement is for defeating the boss El Macho, who can be found at the second iteration of El Macho's Lair stages (Section 12). Specifically, his boss fight is on stage 162.
The fight itself is not complicated, nor difficult. It is fought in the same manner as the rest of the bosses you have faced so far.
NOTE: There is a cryptic message that appears during some of the load screens that indicate you can face El Macho if you venture far enough into his lair. Not sure if this suggests you can face him earlier in the game by reaching certain distances, or if it is simply referring to section 12 (which is a collection of El Macho stages).
NOTE: It has been indicated by some that this achievement has randomly unlocked for them at an earlier part in the game, while not even meeting the achievement requirement. As of now however, I have no ideas on what may cause this glitch, or how others can replicate it.