In this paper, we study the reactive scheduling problems in a dynamic and stochastic manufacturing environment. Specifically, we develop a simulation-based scheduling system for flexible manufacturing systems. We also propose several reactive scheduling policies (i.e. when-to-schedule and how-to-schedule policies) and test their performances under various experimental conditions, processing time variations, and machine breakdowns. Moreover, we compare offline and online scheduling schemes in a dynamic manufacturing environment. The results of extensive simulation experiments indicate that the variable-time-response is better than the fixed-time-response. The full scheduling scheme generally performs better than the partial scheduling. Finally, the online scheduling is more robust to uncertainty and variations in processing times than the optimum-seeking offline scheduling. A comprehensive bibliography is also provided in the paper.