The application of momentum-space three- and four-body scattering equations to the description of nuclear reactions involving systems of three and four nucleons is reviewed, and major achievements and challenges are identified. The calculations include realistic state-of-the-art interactions between nucleon pairs, together with the Coulomb interaction between protons. The effect of including three- and four-nucleon forces is discussed. Further calculations are shown involving the study of nuclear reactions where three-body degrees of freedom play a significant role. These studies involve not just an attempt to describe data in terms of a full three-body model that is solved numerically in a converged way, but also to use this exact framework to validade and test the accuracy of approximate reaction methods such as continuum discretized coupled channel (CDCC), distorted wave impulse approximation (DWIA), plane-wave impulse approximation (PWIA) and the Glauber multiple scattering approach. These comparisons are able to teach researchers under which conditions approximate methods can be used to extract important structural information about exotic nuclei. Prospects and challenges are discussed.