Plain English Meaning
The number shown on the cockpit instrument that tells you how far you are from a particular ground station, measured in nautical miles.
Full Definition
The slant-range distance in nautical miles displayed by the aircraft's Distance Measuring Equipment, indicating how far the aircraft is from the selected DME ground station.
Context Anchor
Seen during instrument flying when a holding pattern is based on DME distances instead of only timing.
Derivation
DME stands for Distance Measuring Equipment. 'Readout' simply means the value the instrument displays — what you read out of it. Together: the distance figure shown on the DME indicator.