While it is still not available on our computers, it's in the making at the moment: raytraced computer games engines. For the record: almost any modern 3D computer game, like Second Life, uses so called raycasting as computing method, which is a much smaller version of raytracing itself. To sum the differences up in short: raycasting cannot compute reflactions, retractions or shadows at all; raytracing can. This makes raycasting of course much, much faster, while raytracing was still slower in these days, but produces much more realistic pictures in the end. Movie productions, like Shrek for example, are all made with raytracers and big rendering farms in the background, as raytracing needs much more horsepower in your computer to work sufficiently than raycasting needs.
Popular raytracers for the normal human being are for example Blender, which was used to produce the movie picture "Elephant's dream" or the Persistence of Vision Raytracer, short Povray. For examples, how raytraced pictures can look like, take a look at the Internet Raytracing Competition. This competition began back in 1996, there are six rounds every year, running for two months under a certain theme, everybody can apply with his own pictures and in the end the winners are voted. Many pictures there are really artistic and it is a nice showcase to demonstrate what modern raytracers are capable of; also a good showcase to get an impression of the rendering times for those pictures, if you take a look at the commentaries. For example a picture like this one or this one could never be done with a raycaster. Period. If you want to get an impression, what animations made with raytracers can look like, take a look at the animations there or download Elephant's dream, since it is for free and a good showcase of what Blender is capable of (a new version of Blender was released some days ago, so it can now do even more).
So, to sum it up: raycasters are the way modern 3D computer games do their work. It is the technology that has been used by good old Doom, Unreal Tournament, Quake and is also used by Second Life and many other games. It's the industry standard for computer games. It is a subset of the possibilites what raytracing is capable of. Raytracing itself has been probably around even longer, but the CPUs were not fast enough until recently to use raytracing in gaming engines, until now, so it seems.
The University of Saarland is doing research in this field and a group around Professor Slusallek is using a new raytracing code that makes use of multicore CPUs and modern GPUs. They are going to showcase their software at the CeBIT and are claiming, that it is already good and fast enough for usage in modern computer games. There has already been a project around, called Quake 4 Real Time, that has enhanced the old Quake engine to raytracing usage. There are also many screenshots and a video on that page to showcase how such a game looks like and no, it's not for download.
If you take in account, that they are using high end CPUs at the moment to achieve their goals, but the technology is already around and the software now, too, as it seems, then it would be not surprising to see raytracing game engines in around 3-5 years entering the computer gaming market, since until then the technology is more at the mid to low end and should be around in masses. This could be definitely the next big step in computer gaming and is worth watching it.
To sum the outcome up: at the moment a game designer has to work around the shortcomings of raycasting and its shortages. But with raytracing capable game engines this would be gone, you can build what you like, but of course you must place your light sources better.