We investigate production of three-photon and four-photon states in cascaded parametric processes of photon splitting and summing in χ (2)nonlinear media, under action of pump field. Generation of photon triplets using simultaneously phase matched three-photon processes: ω0↔ω1+ω2 , ω2↔ω1+ω1 , is considered in dual-grating layered structure that involves nonlinear and linear segments. The production of heralded two-photon entangled states from three-photon states is analyzed for this configuration by using the method of conditional detection of auxiliary photons. Cascaded four-photon downconversion based on simultaneously phase matched three-photon processes: ω0↔ω2 +ω2 , ω2↔ω1+ω1 is arranged for phase-reversed configuration. The effects of correlation between photons in both three-photon and four-photon states is analyzed in the regimes of amplification of corresponding modes at the frequency of three-photon downconversion ω1 = ω0/3 and the frequency of four-photon down-conversion ω1 = ω0/4respectively for both cascaded systems.© (2010) COPYRIGHT SPIE--The International Society for Optical Engineering. Downloading of the abstract is permitted for personal use only.