The tool requires that the input raster have an attribute table, and the one specified does not. The attribute table is usually created automatically for integer rasters but may not be under certain circumstances. You can use Build Raster Attribute Table to create one. If the zone input is a feature dataset, certain conditions prevent an internally generated attribute table from being automatically generated.
If the input is a raster, make sure it has an attribute table. If the input is a feature dataset, convert it to a raster and use that as the input instead. See Working with Tabulate Area for more details.