Generally used when someone who previously followed rules and regulations begins to deviate from them to achieve new goals/desires. The term is most often used when someone who is generally accepted as "good" adapts behaviors which are seen as "bad". – Walt broke bad when he was diagnosed with cancer;

to reject social norms for one's own gain or amusement. To give up on the typical moral and social norm and go one's own path, regardless of the legality or ethics – Are you really ready to break bad, bitch?