All this happems during chapter 3, after the airship you just flew on has crashed. Make your way forward until you arrive at the same place as shown on my picture, from here just move towards the dude (MacLeod) and behead him for all bloody causes! When you've had your psycho moment you will earn the achievement. At the same time yoiu can also loot his exotic blade, how awesome isn't that really?.
This is what I had to offer right now, hope you have some happy achievement hunting!