A foliation is a prescription for coordinitizing spacetime. It is an aspect of general relativity, and is not specific to quantum gravity. When you 'foliate' a spacetime, you define spacelike hypersurfaces and give a prescription for how these hypersurfaces evolve in time. In short, you 'fill' the spacetime manifold with hypersurfaces such that for every point x in the manifold, there is a hypersurface that contains it. As a simple analogy, allow a book to represent a 3D spacetime. Then, the 2D pages of the book are your hypersurfaces, and the page numbers define how you go from one to the next: the pages and page numbers make up your foliation.