Macbeth is referring to Duncan’s son Malcom, just named king, named instead of him.
Macbeth is innocent enough before he decides to become king. His bravery is even lauded in the battle with the Thane of Cawdor. It is because of this that King Duncan decides to reward him. He does this by making him the new Thane of Cawdor. Macbeth is not happy with that, because the witches told him that he would be king instead. He is therefore not satisfied with just being Thane of Cawdor. To him, Duncan naming Malcolm, even though Malcolm is his son, is a slap in the face. In an aside, he tells the audience that Malcolm is a “step” that lies in his way.
Stars, hide your fires;
Let not light see my black and deep desires:
The eye wink at the hand; yet let that be
Which the eye fears, when it is done, to see. (Act 1, Scene 4)
Banquo is beginning to suspect Macbeth already, and even though this little speech is an aside that only the audience hears, it is reinforced by Macbeth’s mannerisms and expression enough that Banquo. As a friend, Banquo tried to tell Macbeth not to listen to the witches earlier.
The instruments of darkness tell us truths,
Win us with honest trifles, to betray's(135)
In deepest consequence— (Act 1, Scene 3)
Macbeth does not listen to Banquo, because he has caught the bug. He is convinced that he is worthy of being king, and Duncan has overlooked him. Although it may seem logical to most people that Duncan would choose his own son over some noble in his court, Macbeth is so self-centered that he is only thinking about what the witches told him and how to make it happen. The witches told him he would be king, and he is going to be king. How to be king: kill the king!