Surface-Mount Technology (SMT) refers to the way components are mounted on a PCB: SMDs (Surface-Mounted Devices) have pins or contacts which lay on top of the PCB's pads, without the need for holes in the PCB.
SMT in PCB production became widely used in the late '80s.
Space-saving: since the components don't need mounting holes, both sides of the PCB can be maximally used.
Miniaturization: saves space. Components can be as small as 0.4 mm (01005 resistors) or 5 mm2 16-pin ICs, e.g. the LPC1102UK:
Cost-saving: smaller components use less materials, and SMT needs less holes to be drilled in the PCB.
Less inductance: shorter connections have less inductance than PTH components, which increases maximum frequency.