It can mean a physical road, it can mean a spiritual road, or it can mean a way of life. The Tao is also the way of nature. Nature grows spontaneously, according to the inner promptings of its being. Nature is incapable of habitual, compulsive, or contrived behavior. Thus nature becomes the model of the Tao.
Nature is always in a constant state of flux and transformation.
You can't step twice into the same river. Lao Tzu could have said that. Thus the term Tao implies vitality and movement. You can't fully grasp the Tao with rigid concepts and language, any more than you can capture flowing water in a bucket, or the wind in your hands. Yet paradoxically, the Tao is also right here and now since we can perceive the Tao by observing the course of a stream or the flow of our own breath.