。
She smiled at me when we passed each other on the street.
Literal
She [topic-は] street [at-で] pass-by [when-時に] me [to-に] smiled-at.
すれ違う ('to pass each other') is a compound verb meaning 'to cross paths' — literally 'to rub past.' 微笑みかける ('to smile at someone') uses the ~かける auxiliary, meaning 'to direct an action at someone.' This directional ~かける is distinct from the 'half-done' or 'about to' uses — here it means the smile was aimed at the speaker.