When you do something menacingly, you appear very scary and threatening. Next Halloween, you might consider standing menacingly on the dark porch in your vampire costume to hand out candy — but you may scare off the trick-or-treaters.
Menace is danger and its Latin root means "to threaten," so acting menacingly means you give off truly dangerous vibes. It's probably best to avoid that one street with the big dogs that bark menacingly over the fence as you walk by. And if your portrayal of the villain in the school play isn't quite convincing, the director might encourage you to creep around the stage menacingly.